Rising Significance of Employee Benefit Insurance in Corporate India

In the ever-evolving landscape of Indian corporate culture, the spotlight is now firmly on the importance of employee benefits. Companies across the country are increasingly recognising the multifaceted value of offering comprehensive benefit packages to their workforce.

The fierce competition for talent is one of the key driving forces encouraging corporations to invest in benefits for employees. In a talent market where highly, skilled workers are in strong demand, offering an attractive benefits package could turn out to be a game changer for the recruitment and retention of the best talent. Benefit packages transmit as visible proof of a company’s commitment to its employees’ well-being, boosting job satisfaction and loyalty.

Furthermore, companies are becoming increasingly conscious of the critical role that benefits play in protecting their employees’ physical and financial wellbeing. From Group Health Insurance to Personal Accident Coverage, these benefits provide employees peace of mind by ensuring that they and their families are covered in times of crisis.
Financial stability also hinges on the well-being of key personnel. To mitigate the potential fallout from the loss of key employees, companies invest in Key Person insurance. This serves as a safeguard against disruptions to business operations and financial stability.

The Evolving Landscape of Employee Benefits in India
Employee benefits in India include a variety of programmes, ranging from the statutory, such as Gratuity, Provident Fund, and ESIC, to the optional, which cater to a diversified workforce’s demands.
Group Health Insurance for employees and their families, Parental Health Insurance, Personal Accident, Life Insurance, Critical Illness, and the growing trend of Out-Patient Department (OPD) Insurance are typical plans acquired by Indian organisations. Wellness benefits are increasingly gaining popularity, with an emphasis on preventative healthcare treatments.

However, other equally important advantages are sometimes overlooked. Key Person Insurance, Global Health Coverage for top executives, and Critical Illness Coverage are growing in importance. These are essential for protecting a company’s interests and maintaining leadership stability.

The extent and nature of employee benefits can vary significantly across industries and employee sizes. Leading sectors such as IT, ITES, FMCG, investment banking, and large BFSI organisations are at the forefront of adopting advanced benefit practices. These include Flexible Benefits, OPD coverage, Health Checkup Benefits, Mental well-being, and Financial well-being, which are increasingly being adopted. Initiatives promoting diversity and inclusion for women employees, LGBTQ individuals, and specially-abled employees are being considered carefully. Benevolent benefits like cover for family post-death of the employee, deferred life cover, or separation benefits are also being considered.

Companies are making the transition from traditional defined benefits to defined contributions in response to a multi-generational, diverse workforce and escalating benefit expenditures. Individuals are able to customise their benefits packages based on their own requirements, increasing their total value as a whole.

Technology is revolutionising benefit delivery, making processes more efficient and user-friendly. Like the entire digital onboarding and claim process, features like 100% cashless options are becoming common, improving the accessibility and convenience of employee benefits.

A shift is occurring even within the traditionally benefits-averse landscape of Micro, Small, and Medium-sized Enterprises (MSMEs). These businesses, which once focused mainly on salaries, now recognise employee benefits’ significance, and have started considering benefits in line with large companies.

Despite increased knowledge of employee perks among both companies and employees, a considerable gap between company attitudes and employee wants exists. Benefits Communication remains a difficulty, and businesses must overcome this gap to ensure that employees fully understand and appreciate the value of their benefits.

To summarise, the growing relevance of employee perks in corporate India is a strategic requirement rather than a short-term trend. Companies understand that a comprehensive benefits package is critical to their success, influencing employee acquisition, retention, and overall organisational health. In today’s dynamic era of corporate India, firms must adapt by giving new perks and effective communication techniques to fulfil the different demands of their employees.

The author is National Head- Health & Benefits, Howden (India)