Open enrollment recap: What’s on the minds of workers?

Many workers had the opportunity to review and make changes to their benefits over the past year. For most, this took place during the fall 2023 open enrollment season. While the rate of inflation had slowed, workers continued to feel the impact of higher prices. The stock market was doing well, and the labor markets remained strong, and  these factors impacted how workers thought about their benefits and the potential changes they might make to their coverages. 

LIMRA conducted a survey in January 2024 to see what decisions workers recently made regarding their benefits in order to better understand the impact external influences had on their decisions. Knowing what is on the minds of workers can help benefits advisors, carriers, and others position conversations and strategies that lean into workers’ thoughts and provide solutions to address them.

Almost 7 in 10 survey respondents reported that their employer had an open enrollment period during 2023. During that period, approximately 1 in 3 of these workers enrolled in or made changes to their insurance benefits. Those most likely to enroll or make changes were younger workers (Gen Z and Millennials) and those with children under the age of 18 in the household. Lower income workers were also more likely to enroll or make changes. 

Among workers enrolling or making changes, most modified coverage to an existing insurance benefit, such as changing coverage amounts, plan type, or adding/dropping family members, certain features, or options. Fewer workers (12%) enrolled in a new insurance benefit, while even fewer (5%) dropped one or more specific insurance benefits altogether during the enrollment period. Most workers (63%) kept the same insurance benefits and made no changes. 

As workers review their benefits and make their decisions, they consider a number of factors. Some reflect personal situations such as getting married, starting a family, or exhibiting new needs based on changes in their health and related wellness. These life stage changes often trigger changes to their benefits. Other factors can also impact a worker’s decision on whether to sign up for a new insurance benefit or modify coverages to existing benefits. 

When reviewing and selecting benefits during their most recent enrollment period, the cost and affordability of the benefits played a significant role for most workers. More than 8 in 10 workers cited affordability and the cost of coverage as having at least some influence on their benefits decisions, while almost half (44%) said it had a lot of influence. This was followed by concerns about inflation. While the rate of inflation has slowed, prices remain high, placing pressure on workers’ ability to participate in voluntary benefits or limit their coverage on other benefits where they contribute to the cost of coverage. 

Rising medical costs place added pressure on workers, as they take on higher deductibles, copays, and share of premiums. Other factors that come into play include the chance of an economic downturn or recession, politics or government regulations, and stock market volatility. These variables introduce instability and uncertainty into the minds of workers. Younger workers and those with lower household incomes expressed the highest levels of concern across these areas. Concerns about COVID-19 continue to wane, with only 8% of workers citing it as having a lot of influence on their benefits decisions.

Many factors come into play as workers think about addressing their insurance and related financial needs, with many relying on workplace benefits. In the current environment, workers are squeezed financially, making it more difficult to justify the enhancement of their existing benefits or the addition of a new voluntary benefit. However, the risk of not having coverage can be greater. Working with employers, benefits advisors can lean into these concerns by demonstrating the value of workplace benefits, the protection they provide, and the financial risk of not having coverage.

Patrick Leary is corporate vice president, workplace benefits research, at LIMRA and LOMA.