Economy Affecting Employee Benefits

Survey shows half of employers have made changes to benefits plans

COLUMBIA, S.C., July 28 /PRNewswire/ -- Half of employers say the economy has
affected the benefits they offer their employees, according to a recent survey
of employers conducted by Colonial Life & Accident Insurance Company.

Colonial Life surveyed more than 750 human resource managers and benefits
administrators at the Society for Human Resource Management (SHRM) Annual
Conference in New Orleans in July. Employers were asked about the economy, the
benefits they provide and how well their employees understand those benefits.

Employers reported making the following changes to their benefits plans as a
result of the current economic climate:
-- 26 percent increased contributions from employees
-- 12 percent eliminated benefits
-- 12 percent offered employee-paid voluntary options
-- 10 percent added benefits

-- 9 percent increased employer contributions

"Today's economy is forcing employers to make tough decisions regarding their
benefits plans," says Tom Gilligan, senior vice president for Colonial Life.
"They're trying to strike a delicate balance between meeting employee needs
and controlling costs."

Employers also reinforced how important they believe it is for employees to
understand and appreciate their benefits. More than 92 percent of employers
surveyed said it was very important to their business that employees
understand and appreciate the value of their benefits. However, less than 19
percent of employers think their employees have a very good understanding of
their benefits. And nearly 5 percent think their employees know nothing at all
about their benefits.

"These findings reinforce what employers have been telling us for a while and
validate last year's survey findings," says Gilligan. "Employers recognize
that employee benefits have a profound impact on morale and job satisfaction.
However, they don't have the resources or time to effectively educate
employees about their benefits. Making benefits communication a strategic
business priority is a real challenge."

Other Findings
The survey revealed several other interesting findings:
-- Nearly 42 percent of employers are considering changing their benefits
packages in the next 12 months.
-- Nearly 90 percent of employers think having one-to-one meetings
between
a benefits counselor and each employee would significantly improve
their
employees' understanding of their benefits.

-- More than 60 percent of employers say they would consider adding
employee-paid voluntary benefits to enhance their benefits plans.

"More and more employers are discovering the advantages offered by voluntary
benefits," says Gilligan. "Partnering with a company that can enhance the
education and communications process at no cost to employers just makes good
business sense in today's economy."

Colonial Life & Accident Insurance Company is a market leader in providing
insurance benefits for employees and their families through their workplace,
along with individual benefits education, advanced yet simple-to-use
enrollment technology and quality personal service.

Colonial Life offers disability, life and supplemental accident and health
insurance policies in 49 states, the District of Columbia. Similar policies,
if approved, are underwritten in New York by a Colonial Life affiliate, The
Paul Revere Life Insurance Company. Colonial Life is based in Columbia, S.C.,
and is a subsidiary of Unum Group.

For more information about voluntary benefits, call Colonial Life at (803)
798-7000 or visit www.coloniallife.com.

SOURCE Colonial Life

Jeanna Moffett of Colonial Life, +1-803-213-5445, jmoffett@ColonialLife.com