Flexible Benefits Case Study - Aviva - Aon

1 Flexible Benefits case Study - Aviva Staying Relevant Aviva is the UK s largest insurer and one of Europe s leading providers of life and general insurance, with 36,000 employees serving around 43million customers worldwide. In 2009, Aviva introduced the my Aviva flex scheme and pension salary sacrifice to 23,000 UK based employees. Debbie Waddington, Aviva explains that Our aims were to: enable our employees to decide what Benefits they wanted offer competitively priced Benefits giving employees value for money help them save money and spread the cost of Benefits engage our employees as advocates of our own products make it easier for employees to see all reward related information The Benefits included within my Aviva flex were a mixture of Aviva Benefits pensions, private medical, life insurance, RAC breakdown and externally provided Benefits discounted shopping card, mobile phones, bike to work scheme.

2 Although my Aviva flex is now business as usual we have strived every year to ensure that it continues to deliver for both employees and the company. Debbie Waddington, Aviva In 2010, the scheme was modified to reflect employee concerns about the economic environment and behind the scenes, administrator processes were developed to ensure the schemes was running smoothly and e-mail password resets were introduced. In 2011, the flex system was used as portal to enable employees who were being transferred from the final salary pension scheme to the money purchase pension scheme to accept this change and to increase or decreases their monthly contributions.

3 In addition, greater use was made of direct e-mail communications and the ability to target messages to specific employee groups. In 2012, the flex scheme was moved to the TBS platform provided by Aon Hewitt. This enabled a Benefits one-stop-shop approach with all of the information about each benefit to be available in one place at the point of selection and the ability to model Benefits and the impact on net pay The technology allowed us to deliver a Benefits one stop shop Debbie Waddington, Aviva A focus on educating not just advertising Employee reward communication has taken giant leaps forward since 2009 when the plan was launched and Aviva have adapted the communications messaging and media to keep pace and engage with employees.

4 Over 2,600 employees attended one of 13 my Aviva Reward roadshows My Aviva flex video available on the website and on plasma screens in contact centres Several employee and manager WebEx sessions were held prior to and during enrolment Local plans were put in place to focus on midsized locations with support from local contacts Aviva financial advisors attended roadshows to offer advice to employees on all internal Benefits including pensions We used a mixture of communications channels including e-mail, intranet, z-card, video, WebEx sessions, roadshows, briefing packs and local champions Debbie Waddington, Aviva Results The effort put in since 2009 has really paid dividends, Aviva have: Compiled a strong reward package for employees as the table below displays.

5 Top 5 Benefits in 2012 1 Buying and selling of holiday (21%) 2 Home computers ( ) 3 Life insurance (11%) 4 Payroll giving ( ) 5 Private medical ( ) helped employees to understand the flex scheme, the Benefits on offer and the benefit to them of taking part in the scheme The average benefit holding increased from to enabled employees to choose the Benefits they want and to save money Average benefit spend increased from to increased the take up of the Benefits within my Aviva flex year on year: Take-up rate 2009 30% 2010 57% 2011 65% 2012 74% increased the awareness and engagement with the pension scheme Scheme participation for employees under 30 increased from 42% to 53% increased the awareness and engagement with the pension scheme Scheme participation for employees under 30 increased from 42% to 53% promoted the advocacy of Aviva products through their inclusion in the scheme Critical illness (an Aviva product)

6 First year take up was driven the communications of the overall reward package including financial and pension education The Future Although my Aviva flex is extremely successful, new challenges and opportunities are always on the horizon. As Debbie Waddington explains Obviously we want to keep the scheme fresh and appealing but we also believe we can get the twitter/facebook generation and contact centre areas more engaged; there is more we can do to optimise the scheme design, the range of Benefits and pricing; and enhance employees understanding about tax and Benefits -in-kind. Ensuring we face the future from a strong position relies on a good design, strong technology and a focus on communications.

7 Ensuring we face the future from a strong position relies on a good design, strong technology and a focus on communications . Debbie Waddington, Aviva As Martha How of Aon Hewitt adds Along with many other organisations the scheme will have to adapt to global rather than local strategies. In terms of the Benefits marketplace, we also expect to see changes in the design of Benefits plans with shrinking core Benefits and a greater emphasis on the Benefits funding from employers with the associated requirements to include savings modellers and financial planning. Communication media will expand with more online and mobile communications.

8 Expect to see changes in design .. and more online and mobile communications. Martha How, Aon Hewitt