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Employee Insurance Series - Pt. 3

Previously, we talked about what employee insurance is, why businesses across New Zealand are offering it to their employees and how it can help them and their families.


Now, we will crunch the numbers.


A Financial Perspective


Insurance is only worthwhile if it makes financial sense. Often, investing in insurance is a smart business decision and –  after staff get used to making the most of their newfound financial support –  it can end up having a noticeable positive impact on a business’s performance and financial direction. 


Below is an example of how the benefits of Employee Insurance can outweigh the cost. To keep it simple, we'll just give you the data on employer-funded health insurance:


Absenteeism & Productivity


It can be costly when staff or their family get sick. An absent employee typically costs a Kiwi business $600 to $1,000 a year [1]. However, health insurance for the same employee could cost your business just over $562 a year [2]. This health insurance could pay for them to visit a GP for early treatment so they don’t have to take as many sick days.

People with employer-funded health insurance seek out treatment earlier and take fewer sick days overall [3].

Businesses offering employer-funded health insurance reported a 17% drop in absenteeism [4].


Engagement, Satisfaction & Retention


When your team is engaged, they can deliver to their full potential. Employees with employer-funded health insurance report higher job satisfaction than those without cover [4].

92% of professionals say it is very or somewhat important for them to work for an employer that offers a workplace wellness programme [5].

The likelihood of an employee staying with an employer that has a workplace health and wellbeing programme increases from 15% to 24% compared to an employer without these benefits [6]. That results in some big savings not just by boosting performance, but also reducing the need to spend money replacing employees and training new ones.


Culture & Health


Health and wellbeing strategies can help reduce health risks (like stress) for your employees [3].

One contributing factor to stress within your organisation could be the impact of other sick employees. One third of employees say they suffer more from stress when their colleagues are absent due to a serious condition [7].

Employees with subsidised health insurance are more likely to visit a doctor for a regular check-up, a medical specialist or physiotherapist and have elective surgery.[7] This can keep them healthy and performing at their best.


Staff Attraction


In a tight job market, finding and keeping the best people is a challenge. Offering Employee Insurance can give you the edge you need.

When considering a job, 32 % of full-time employees rate employer-funded health insurance as more important than an employer’s reputation or the recommendations of friends and family [4].

87% of professionals agree that an organisation’s workplace wellness policy is important when considering new opportunities [8].


Research Cited: 1. Wellness in the Workplace Survey, 2017, BusinessNZ and Southern Cross Health Society. 2. Pricing of $562 p.a. based on a fully subsidised Southern Cross Wellbeing One plan ($500 excess) with a work scheme size greater than 25 with an average age of 35, effective from June 2019. 3. The role of employer funded health insurance on business performance, HRINZ, June 2016. 4. Employer benefits of health insurance, TNS, August 2015. 5. Robert Walters white paper ‘The value of promoting employee health and wellbeing’ (based on a survey of 1,000 hiring managers and more than 2,400 professionals across Australia and New Zealand). 6. Employer Benefits of Health Insurance, TNS survey, August 2015. 7. Understanding the employer benefits of health insurance, TNS, August 2015, survey over 2,300 New Zealanders in full time employment. 8. Understanding the employer benefits of health insurance, TNS, August 2015, survey over 2,300 New Zealanders in full time employment.