As per the survey conducted by Deloitte India 2022 related to the Workforce and Increment Trends. India has faced an increase in the average workforce attrition rate from 15.8 percent in 2020 to 19.8 percent in 2021. It was fueled by various factors, such as lower salaries, reduced fringe benefits, increased workload, insufficient workforce insurance, and reduced interpersonal & social interactions. Therefore, in today’s workforce environment, it’s more crucial for companies to provide their employees with comprehensive insurance coverage, job security, health security and flexibility. By doing so, companies can reduce attrition and will see a drastic increase in employee retention.
What is Employee Attrition?
When the employee leaves the company through voluntary resignation due to personal or professional reasons and the vacant position cannot be replaced immediately. This refers to employee attrition. There can be various reasons including low salary, no salary hike, lack of employee benefits, unfavourable office conditions etc.
How Comprehensive Insurance Coverage Can Benefit in Reducing Attrition?
● By Providing Health Insurance Coverage to Enhance Productivity
Health insurance coverage for employees is essential to offer them access to proper treatment. This will increase employee wellness and is helpful for workers who are often exposed to hazardous working environments. This will, in turn, enhance health security and productivity among the employees.
● Reduces Company Liability
Workmen’s compensation insurance is important for companies to have in order to
avoid higher costs and lawsuits. This type of insurance will cover any liability that results
from an employee’s disability, injury, or death while on the job. The amount rewarded
can help workers and support their families due to loss of income.
● Encourages Employee Loyalty and Job Satisfaction
If companies financially secure their families with comprehensive insurance coverage including health and life insurance, the employee will feel valued. This encourages loyalty towards work and gives them job satisfaction.
● Helps with Tax Benefits
The premium that companies pay for employee benefits coverage becomes a business expense. This is reflected in the P/L account and is eligible for tax breaks, known as ’employer entitlement,’ according to the Insurance Regulatory and Development Authority Act, 1999.
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