Expert perspective: Companies in the UK are extending core benefits to their wider employee base

As employee expectations increase exponentially, companies are reassessing how they support their workforce. Our Big Benefits Report 2024-25 highlighted that benefits have become the most important part of the employee experience for both organisations and their people. And as UK public health services come under strain and employees face economic challenges, employers are looking to benefits to provide their people with greater support. Where budget allows, organisations are extending core benefits to a wider range of employees – and where it doesn’t, they are providing a wider range of salary sacrifice benefits on an anytime basis.  

Extending core benefits to a wider employee base 

Companies are doubling down on health, risk and protection benefits, such as private medical insurance, healthcare cash plan, life insurance and income protection. Crucially, many employers are now extending these benefits to the whole workforce, whereas once they might only be available to directors and senior management. This shift is driven by the need to enhance employee wellbeing and remain competitive. 

Addressing wellbeing, financial pressures and the cost-of-living crisis 

Employers are rightly prioritising wellbeing and, in particular, mental health and physical wellbeing which really came to the forefront during the pandemic. But there is increasing demand from employees for support around financial wellbeing, so employers are looking to ramp up financial education and engagement. 

We continue to hear a lot about the impact of the cost-of-living crisis, both for employees who are struggling to make their budgets stretch, particularly to cover higher mortgage interest rates and rental prices, but also for employers who are trying to keep a lid on their spending and looking for efficiencies.  

The rise of voluntary benefits and increased claims 

Despite this need to curb spending though, we’re still seeing an uplift in voluntary, employee-funded benefits such as healthcare cash plan, dental insurance, critical illness protection and partner life insurance. And significantly, we’re now seeing the volume and value of claims in the voluntary space increasing at a rapid rate, often more than 25% per year.  

People are using benefits such as healthcare cash plans to prioritise their health and access the support and services they can’t always easily get through state healthcare systems. In fact, we’re even starting to see suppliers closing new voluntary schemes because of the rise in claims to premium ratios. Employers will therefore be thinking about how they get value from these benefits, as premiums will inevitably go up over the next 12 months and beyond. And they will be looking to drive engagement to maximise the value employees get from their spend.  

Employee engagement with benefits 

The other major trend is the way in which employees are now really scrutinising the quality and scope of the benefits available to them. People are spending a lot more time weighing up their options and selecting benefits that they feel can have the biggest impact on their lives. And this is a really positive development for both employees and employers. 

For more practical advice and learnings on all things reward and benefits, download our report: Navigating trends from our Big Benefits Report, where six Benifex experts share their perspectives.