Oops! Seven Common Mistakes Employees Make During Annual Enrollment

COLUMBIA, S.C., Nov. 11, 2010 /PRNewswire/ -- Employee benefits are a key component of your overall compensation package. To make smart benefit choices, steer clear of these seven common mistakes made during annual enrollments, according to Colonial Life & Accident Insurance Company.

Mistake 1.  Being unprepared.

Don't let your enrollment date slip up on you and leave you unprepared.  Read your benefits materials beforehand.  Talk to your spouse about your family's benefits needs.  And make sure you understand any changes that will be made to your new plan.

Most employees spend very little time making their benefits decisions. In fact, employers and brokers surveyed recently by Colonial Life showed they believe employees spend less than an hour making their benefits decisions.(1) By contrast, consumers spend twice as much time researching which television to buy.(2)

Mistake 2.  Not knowing what benefits you currently have and their cost.

Many employees simply don't know what benefits they have.  Reviewing a benefits statement, if your employer provides one, can give you an overview of your personal benefits plan and the contributions made by you and your employer.  Doing so will help you recognize the value of the benefits your employer provides, identify any gaps in coverage and determine how much you can spend on any additional benefits you may need.

Mistake 3.  Not checking to see if your dependents are still eligible for coverage.  

The new health care reform law allows dependent children (up to age 26) to remain on their parents' health insurance plan unless they're eligible for coverage through their employer. To avoid confusion and disappointment, make sure your dependents are eligible for health coverage and any other products and programs offered. Be sure to update personal information as needed.  

Mistake 4.  Not taking advantage of flexible benefits plans and pretaxing premiums.

Many companies offer flexible benefits or "cafeteria" plans that allow you to pay for certain qualified benefits on a pretax basis, which reduces your taxes and increases your spendable income.  Participating in a flex plan also allows you to tailor your benefits to meet your individual needs, makes your benefits more affordable and allows you the opportunity to purchase additional benefits with the tax savings.  

Mistake 5.  Not attending a group meeting.

Many companies schedule group meetings prior to their benefits enrollment to give employees an overview of their new benefits packages and any changes or additions that have been made.  Group meetings are a good way to find out what's new and get the answers to any general questions you have about your new benefits plan. Take time to attend, so you'll be better prepared to make smart benefit choices.

Mistake 6.  Renewing your current benefits without reviewing them first.

Don't take a passive approach and simply renew the same benefits selections you had last year without first reviewing them to make sure they're relevant.  Situations change, and your benefits should change along with them. Marriage, divorce, the birth of a child and changes in your salary can all affect your benefits needs. Take the time to review your benefits each year to make sure they still fit you and your lifestyle.

Mistake 7.  Opting for online enrollment instead of a benefits counselor.

While online enrollment is convenient and relatively fast, this method can be impersonal and somewhat inflexible.  Enrolling online can also leave you with unanswered questions.  Scheduling a personal session with a benefits counselor, if this option is available to you, lets you get your individual questions answered in a private, confidential setting—with a real live human being.  Enrollment is then handled using an electronic or web-based system.  Don't overlook the value of meeting face-to-face with someone who can explain your benefits and help you understand your coverage.

"Choosing benefits during annual enrollment is one of the most important decisions employees make every year," says Randy Horn, president and CEO of Colonial Life. "That's why we recommend employees carefully review their current benefits and evaluate their needs for the coming year.  A little preparation goes a long way in helping employees make sure their families and their lifestyles are protected."  

About Colonial Life

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, Worcester, Mass. Colonial Life is based in Columbia, S.C., and is a subsidiary of Unum Group, one of the world's leading providers of employee benefits.

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

(1.) Survey of insurance brokers and employers Sept. 26-28, 2010 at the Benefits Forum & Expo and Employee Benefit Adviser Summit, Boca Raton, Fla.

(2.) Survey by Zillow Mortgage Marketplace and Harris Interactive, April 12-24, 2010.  Press release,   http://zillow.mediaroom.com/index.php?s=159&item=201.  

SOURCE Colonial Life