August 4, 2016
Employee Benefits: ID Theft Coverage
Employers looking to retain valued employees are increasingly including identity theft protection services as a perk.
Employers looking to dial up the correct mix of benefits to retain valued employees are increasingly including identity theft protection services as a perk.
Research firm Willis Towers Watson predicts identity theft protection, offered by 35% of employers in 2015, could double to nearly 70% by 2018, making it the fastest-growing type of employee benefit over the next couple of years.
See also: Identity Theft Can Be Double Whammy
ThirdCertainty recently sat down with Joel Ray, the CEO of New Benefits, a Dallas-based employee benefits solutions provider, to discuss the drivers — and the arc — of this trend. The following text has been edited for clarity and length:
3C: Identity theft has become part of the lexicon of the world we now live in.
Ray: With all the hacking of corporations, health plans and government, there is a myriad of ways people can get their identities stolen and misused, whether it’s medical fraud, tax return fraud, stealing a Social Security number or a credit card information scam.
To me, not protecting yourself with an identity theft protection service is commensurate with not locking your door and setting an alarm when leaving home or not buying life insurance to protect your family. It just makes all the sense in the world, when you have the ability and a product is available to address identity theft, to include this as an employee benefit.
3C: So how do employers view this?
Ray: Employers were the first ones decades ago to offer health insurance to their employees, and early adopters have added other types of benefits over the years. The idea, of course, is to attract and retain good people . … Research shows an employee’s financial health is every bit as important as physical and mental health. If anything goes wrong (financially), they are not going to be a productive worker. Meanwhile, identity theft happens every two seconds in the U.S. to quite a large number of Americans. So, identity theft protection is something that, in today’s digital world, makes perfect sense to provide employees, either on an employer-paid or payroll deduction basis.
3C: How much of a challenge is public awareness?
Ray: The hard part is the education. Yet the almost daily reports about breach events have gotten employers more interested. We’ve had many (benefits) brokers representing our products say that, for the first time, employers are asking for identity theft protection.
It really is the brokers in today’s world who act as consultants regarding the latest and greatest new products. And, typically, identity theft is toward the top of the list — if not at the top of the list.
See also: ID Theft: A Danger Even After Death
3C: How does improved productivity factor in?
Ray: Identity theft protection is like any other benefit. Basically, anything you can do to provide financial security to your employee is a good thing. It’s a primary reason employers provide 401Ks. A lot of voluntary benefits, like cancer disability, critical illness and dental, charge a lot more for family coverage. This one charges a little bit more, but you get financial security and protection, not only for the employee but for the entire family, as well. It’s a very inexpensive benefit relative to the protection it offers, and I think it will become a staple of the industry in the very near future. The early adopters who provide this benefit to their clients now are going to have market advantage over those who wait.
3C: Sort of like supplying peace of mind as a benefit?
Ray: Yes. For example, employees buy life insurance for peace of mind so the family is protected in case of an untimely death. With identity theft protection, employees and their families are protected from something that happens every day from thieves who always seem to be one step ahead and out of reach from the law. If you’re an employer, wouldn’t you rather offer your employees a benefit that will meaningfully protect them from financial harm versus other benefits that, based on the historical record, may not add any real value?
More stories related to identity theft insurance:
As threats multiply, cyber insurance and tech security industries start to merge
Cyber insurance industry could face turf war, report warns
NAIC sets model standard for consumer rights, cybersecurity
This article originally appeared on ThirdCertainty.