financial-wellness-the-next-frontier-in-wellness-programs.pdf

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FINANCIAL WELLNESS:THE NEXT FRONTIERIN WELLNESS PROGRAMSWhy It Matters to Employers

and Employees, and the New

Way to Measure It Effectively

A white paper developed by Prudential, using

supporting research and analysis provided by

EY Insurance and Actuarial Advisory Services.

0269547-00002-00


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TABLE OF CONTENTS

Executive Summary 1

The Evolution of Wellness Programs 2

Defining Financial Wellness: What It Is and Why It Matters 2

Measuring Financial Wellness: Prutection ScoreSM 4

Benchmark Scores and What They Tell Us 5

Benchmark Scores by Key Demographic Segments 6

The Impact of Insurance Programs on Financial Wellness 8

Best Practices for Improving Employees Financial Wellness 9

Conclusion 12
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EXECUTIVE SUMMARY

Employers have a vested interest in promoting the financial health of their employees, who can become less productive when burdened by money

worries. Nearly a quarter of employees confirm that personal finance issues are a distraction at work, and 39% say they spend three hours or more

each week dealing with issues related to personal finance.1

To alleviate these stresses, increasing numbers of employers are implementing financial wellness programs that educate employees about

the financial risks they face and provide tools to manage those risks. To support and enhance these efforts, The Prudential Insurance Company

of America (Prudential), with supporting research and analysis provided by EY,2has created Prutection ScoreSM, a patent-pending tool to help

employers evaluate the financial wellness needs of their employee populations. Prutection Score SMprovides employers with measures of how well

protected their employee populations are against key financial risks they face every day: loss of income due to premature death, illness, or injury;

out-of-pocket medical and non-medical expenses related to unexpected health events; and outliving assets in retirement.

The opportunities to improve individuals financial wellness are vast. Drawing on data from its 2014 Financial Wellness Survey, Prudential has

found that most employees are unprepared to fully cover key financial risks they face during their working careers. Prudential also has found that

for each risk category, Prutection ScoresSMvary dramatically from one demographic group to another.

With these data in hand, employers now have the ability to create tailored, needs-based financial wellness programs that efficiently target

educational efforts and financial protection solutions to the employees who need them most.

This paper introduces a financial wellness measure and new national benchmark scores for the U.S. workforce. It explores the key demographic

drivers that can impact financial wellness and suggests best practices for employers seeking to implement or improve financial wellness programs.

1PricewaterhouseCoopers, Employee Financial Wellness Survey, 2014, page 11. 2EY Insurance and Actuarial Advisory Services, 2014.


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THE EVOLUTION OF WELLNESS PROGRAMS

Over the past decade, employers have learned that improving the health and wellness of their workforce yields benefits for employers

and employees alike. Employers enjoy a healthier workforce that is more productive, has fewer absences, and makes fewer demands upon

employer-sponsored health insurance. Employees benefit from improved health and well-being and reduced medical expenses. Seventy-seven

percent of employers that provide health benefits now offer at least one wellness program, up from 54% in 2008.3Employees have been receptive;

87% consider it appropriate for employers to encourage them to take steps to be healthy.4

Now employers are learning that a new kind of wellness program financial wellness can also have a positive impact. Financial wellness

programs educate employees about the financial risks they face and provide tools to manage those risks. Over 40% of companies say they already

have a financial wellness strategy in place or plan to introduce one.5More will likely join them; 81% of companies say they feel at least somewhat

responsible for their employees overall financial wellness.6

Converting that responsibility into action will require that employers leverage the same strategies they used to create successful health and wellness

programs: educate employees on the importance of the programs, which provides an impetus for employees to take action, and track and promote employee

participation in them. Measuring the current state of employees financial wellness is important, so that employers can track program effectiveness over time.

This paper seeks to further that cause by helping employers understand how to measure and improve their employees financial wellness.

DEFINING FINANCIAL WELLNESS: WHAT IT IS AND WHY IT MATTERS

Many factors contribute to financial wellness, which, for purposes of this discussion, Prudential defines financial wellness as being protected

against risks that are difficult to predict and may have significant financial consequences. In essence, financial wellness is important to

the continuity of life for employees and their families.

For full-time employees covered by medical insurance for their routine medical expenses, Prudential identifies four such risks:

Out-of-pocketmedical

and non-medical expenses

Outliving assets

in retirement

Loss of income due to

premature death

Loss of income due to

illness or injury

More immediate financial risks that may occur during working years

Prudential defines financial wellness as being protected against risks that

are difficult to predict and may have significant financial consequences.

3The Kaiser Family Foundation, Employer Health Benefits Annual Survey, 2013, page 180; and 2008, page 172. 4Optum, The importance of promoting healthylifestyles in the workplace: an Optum research study, 2014. 5Merrill Lynch/Bank of America, Workplace Benefits Report, December 2013, page 9. 6MerrillLynch/Bank of America, Workplace Benefits Report, December 2013, page 4.


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Much attention has been given to the financial risk of outliving ones assets in retirement, but many employees underestimate three more

immediate risks premature death, illness or injury, and out-of-pocket expenses which could cripple their financial well-being tomorrow,

next week, or next month. Employees that are not adequately protected against these risks may need to start paying their day-to-day expenses

by incurring credit card debt, using lines of credit, or taking loans from their 401(k) plans. Accordingly, this paper focuses on the first three,

more immediate threats listed above that may occur during employees working years.

As illustrated in Exhibit 1, several trends are challenging employees financial wellness in each of these areas. They include the shifting

of responsibility for medical costs to employees, rising medical costs, low savings rates, and increasing longevity.

Exhibit 1: Trends Driving Key Financial Risks During Working Years

Risk Current Situation Trends

Premature Death:The risk thatfamily members may not be ableto maintain their standard of livingin the event of an employeespremature death.

Thirty-one percent of Americansbelieve they would feel the financialimpact from the loss of the primarywage earner within a month of hisor her passing.7

Longer lifespans mean more yearsto provide for dependents, such asa surviving spouse or partner. Theaverage life expectancy for a 65-year-old female has increased to88.8 years, up from 85.2 in 2000.8

Many Americans are caring for multiplegenerations of family members.

College tuition has increased at a ratehigher than inflation for 30 years.9

Illness or Injury:The risk that an

employee could no longer work and

earn wages due to an illness or injury.

A 35-year-old leading a healthy

lifestyle has a greater than 20%

chance of becoming disabled forthree months or longer during hisor her working career, with a 38%chance that the disability will lastmore than five years.10

Many employees live paycheck-to-

paycheck; 66% say it would be very

or somewhat difficult to meet theircurrent financial obligations if theirnext paycheck were delayed fora week.11

Out-of-Pocket Medical and

Non-Medical Expenses:The risk of onerous expenses borneby an employee in the event of acritical illness or accident.

There were nearly 38 millioninjury-related emergency roomvisits in 2012, or one for everyeight Americans.12

One in three women and one in

two men in the U.S. will developcancer during their lifetime.13

Health expenditures are expected tocontinue to outpace inflation between2012 and 2022, increasing at anannual rate of 5.8%14versus 2.1%for inflation.15

Household savings continue to below, with 52% of U.S. households

saying they have less than $10,000in liquid assets available to use in anemergency.16

49% of medical plan participants haveout-of-pocket family maximums of$5,500 or more.17

7LIMRA and Life Happens, 2014 Insurance Barometer Study, 2014, page 17. 8The Wall Street Journal, Pension Plans Brace for a One-Two Punch, March 25, 2014,page B1. 9Claire Hilsinger, Up, Up And Away: College Tuition Is On The Rise, Forbes, July 24, 2013. 10The Council for Disability Awareness, Disability Statistics, July2013. 11 American Payroll Association, Getting Paid in America, Survey 2013. 12 CDC, National Hospital Ambulatory Medical Care Survey: 2010 Emergency DepartmentSummary Tables. 13 Benefitspro, Kathryn N. Mayer, Will Critical Illness Insurance Take Off?, June, 2012. According to the American Heart Association and American CancerSociety. 14 Centers for Medicare & Medicaid Services, Of fice of the Actuary, National Health Expenditure Projections 2012 2022, 2013. 15 Department of Labor (2011);Congressional Budget Office, An Update to the Budget and Economic Outlook: Fiscal Years 2012 to 2022, page 33. 16 Prudential, Financial Wellness Survey, 2014.17 The Kaiser Family Foundation, Employer Health Benefits 2013 Annual Survey, page 129.


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Financial wellness matters to employers as well as employees

Helping employees achieve financial wellness yields benefits for employees, of course, but it also helps employers by reducing stress and

distractions in the workplace, thereby contributing to increased worker productivity and loyalty. Twenty-four percent of employees say personal

financial issues are a distraction at work, and 39% say they spend three or more hours each week thinking about or dealing with issues related

to their personal finances.18Human resources professionals go even further: seven out of 10 indicate that personal financial challenges have

an impact in some cases a large impact on their employees performance.19

Employers are well-positioned to help alleviate employees financial pressures because employers can provide access to protection solutions,

typically in the form of insurance, in an efficient, affordable way. Employers also can support employees with educational resources, calculators,

and communications programs that drive employees to take advantage of the voluntary benefits available to them. This in turn may have a

positive impact on employee satisfaction with benefits: 71% of employees say that even the offer of voluntary benefits increases the value

of their companys overall benefits program.20Employers enjoy a significant competitive advantage in attracting and retaining employees

who believe that benefits programs meet their needs.21

MEASURING FINANCIAL WELLNESS: PRUTECTION SCORE

SM

For employers, understanding the risks to their employees financial wellness is an important first step toward improving it. The bigger challenge,

though, is assessing the financial wellness of their employee base understanding how much money different segments of their employee

population need, and what types of insurance coverages they may require, to be adequately protected against the financial risks they face.

To that end, Prudential, with supporting research and analysis provided by EY, has developed Prutection Score SMto help employers evaluate the

financial wellness needs of their employee populations. For each risk, Prutection ScoreSMgauges how financially prepared employees are should a

risk event occur by looking at the resources available to them personal funds and insurance coverage relative to the resources needed. Resources

are estimated using employee demographic information, Prudential Financial Wellness Survey data, and various government and industry sources.

In developing Prutection ScoreSM, Prudential conducted a Financial Wellness Survey22of over 5,000 employees who had medical insurance.23

Seven in 10 human resources professionals indicate that personal

financial challenges have an impact on their employees performance.

Prutection ScoreSM=Funds and Coverage Available*

Funds and Coverage Needed

* Funds and coverage available is based on an estimate of an employees financial assets, spousal or partner income, investment income, Social Security benefits, and insurancebenefits, drawing from Prudential survey data and external industry and government sources. Funds and coverage needed is an estimate based on a variety of survey data suchas an employees age, marital status, number of children, income, essential monthly expenses (e.g., mortgage, child care), discretionary expenses, and college costs. The figureincorporates realistic assumptions about items such as longevity, inflation, and care-giving costs based on a combination of mortality tables and government and industry data.

18PricewaterhouseCoopers, Employee Financial Wellness Survey, 2014, page 11. 19SHRM, F inancial Wellness in the Workplace, May 2014. 20 Prudential, The ABCs o f Voluntary,the fourth in a series of five research briefs derived from Prudentials Eighth Annual Study of Employee Benefits: Today & Beyond, 2014, page 3. 21Towers Watson, Attractingand Keeping Employees: The Strategic Value of Employee Benefits, May 2014. 22Poll of 5,335 full-time employees with medical insurance conducted using Harris Online Panel inMarch/April 2014, sponsored by The Prudential Insurance Company of America. 23For the purposes of this paper, medical insurance implies a comprehensive plan such as a point ofservice plan, health maintenance organization, preferred provider organization, or high deductible health plan.


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Drawing on data from that survey as well as various government and industry sources, Prudential has developed national benchmark scores

for each of the three more immediate risk categories premature death, illness or injury, and out-of-pocket expenses that we identify as

germane to financial wellness. The higher the score, the better prepared an employee may be to meet his or her financial obligations. A score

of 100 means an employee is likely able to meet financial obligations for a specific risk.

BENCHMARK SCORESAND WHAT THEY TELL US

The benchmark Prutection ScoresSMindicate that full-time U.S. employees covered by medical insurance are unable to fully cover their

exposure to three key risks they face during their working careers:

u Premature Death benchmark score:71. In the event of loss of income due to premature death, the average employee would be able

to cover 71% of ongoing financial needs for a spouses or partners lifetime and for children until adulthood.

u Illness/Injury benchmark score:71. In the event of loss of income due to illness or injury, the average employees household would beable to pay 71% of their monthly expenses using other income sources, such as spousal or partner income and disability insurance24benefits.

u Out-of-Pocket Expenses benchmark score:48. Faced with out-of-pocket medical and non-medical expenses due to a critical illness or

accident, the average employees household is equipped to cover just 48% of those expenses through liquid savings and insurance coverage.

While about a third of employees in the Prudential Financial Wellness Survey score high 90 or higher in each risk category, only 4% score

above 90 for all three risks, and only 2% have scores of 100 or more for all three, as shown in Exhibit 2. This points to a significant opportunity

to improve the financial wellness of American workers.

Exhibit 2: Distribution of Benchmark Prutection ScoresSM

Source: P rudentials Financial Wellness Survey, 2014

33%Premature Death Risk

28%

Illness/Injury Risk26%

12%

Premature Death, Illness/Injury, and

Out-of-Pocket Expenses Risk

4%

2%

Out-of-Pocket Expenses Risk36%

34%

Percent of Employees with Scores Above 90 and 100

Score 90+ Score 100+

Only 2% of employees have a benchmark score

of 100 or more across all three risks.

24Also called disability income insurance.


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BENCHMARK SCORES BY KEY DEMOGRAPHIC SEGMENTS

To refine the value of the benchmarks and identify the groups of employees with the greatest opportunity to improve their financial wellness,

Prudential looked at the key drivers in each risk category, and then calculated benchmark scores for differing demographic groups.

Not surprisingly, the common driver of scores in all cases is the level of insurance coverage currently carried by an employee, as shown in

Exhibit 3. Because most employees have limited control over their income and how much they can save, insurance coverage is an important

and convenient way to achieve a higher level of financial wellness across all three risks.

Exhibit 3: Benchmark Scores and Key Drivers

Risk: Premature Death Illness/Injury Out-of-Pocket Expenses

Benchmark Score: 71 71 48

Key Drivers: Level of insurance coverage Marital status

Number of dependent children

Age

Level of insurance coverage

Marital status

Employee income

Level of insurance coverage

Employee income as a driver

of liquid savings

Source: Prudentials Financial Wellness Survey, 2014

Beyond insurance coverage, there are multiple other drivers, and they vary in significance from one risk to the next. In some cases, a driver is

positive for one risk and negative for another. Being single can improve someones premature death score, for example, because there is no need

to provide for a spouse or partner; on the other hand, it can weaken an individuals illness/injury score because there is no spousal or partner

income to help cover expenses.

u Premature Deathbenchmark scores vary significantly by marital status and age, with marriage especially at a younger age tending

to lower scores. Someone who is married or in a partnership may wish to provide for a spouse or partner for the rest of his or her lifetime,

and the younger that individual is, the more years there will be to provide for that spouse or partner and any children they may have.

Another key driver is the number of dependent children. This is particularly pronounced among employees without a spouse or partner, where

those without dependent children have an average score of 88, while those with one or more dependent children have an average score of 61.

u Illness/Injury benchmark scores are driven by marital status and employee income. Benchmark scores are significantly higher for married

employees due to the additional spousal or partner income available to cover expenses and the potential to receive higher Social Security Disability

Income (SSDI) benefits for a spouse and/or dependents. Scores also increase steadily with income. Because employees with higher incomes

generally have lower expense-to-income ratios, the disability payments they receive, where available, cover a higher percentage of monthly

expenses. Offsetting this somewhat is that employees with lower incomes receive larger SSDI benefits as a percentage of their salary.


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u Out-of-Pocket Expensesbenchmark scores increase steadily with income because employees with higher incomes usually have higher levels

of liquid savings that could be accessed to cover out-of-pocket medical and non-medical expenses. Because household income is generally higher

for employees who are older, male, married, or in a partnership, these scores also are driven by age, gender, and marital status.

Exhibit 4: Benchmark Scores by Selected Key Drivers

Premature Death Illness/Injury Out-of-Pocket Expenses

Marital Status:

Married/Partnership 67% 83% 54%

Single 78% 47% 34%

Age:

< 30 63% 66% 39%

3039 57% 69% 31%

404966% 73% 31%

5059 80% 73% 63%

60 + 90% 71% 82%

Employee Income:

< $50k 72% 69% 31%

$50$150k 69% 73% 59%

$150k + 78% 79% 99%

Number of Children:

Married, 1+ children 66% 81% 56%

Married, no children 70% 86% 51%

Single, 1+ children 61% 49% 40%

Single, no children 88% 45% 30%

Source: Prudentials Financial Wellness Survey, 2014.


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THE IMPACT OF INSURANCE PROGRAMS ON FINANCIAL WELLNESS

Access to Protection Solutions at Work Has Positive Impact on Benchmark ScoresAccess to insurance in the workplace has a positive impact on financial wellness. This is most apparent in illness/injury benchmark

scores. Employees with access to disability coverage at work have an average illness/injury benchmark score of 82, versus 56 for employees

who do not.16

However, disability coverage across employers has been declining. From 2009 to 2013, the number of employers offering long-term disability

insurance declined 3%, and the number of employees with coverage declined 6%. 25The benchmark scores indicate that employers could

significantly boost employees financial wellness by making this coverage more widely available.

The same is true for critical illness and accident insurance. Employees working for employers that offer these coverages have an average

illness/injury benchmark score of 59, versus 40 for employees whose employers do not offer them.16

Type of Medical Insurance Plan Has Little Impact on Benchmark ScoresMost employees have low benchmark scores for the risk posed by out-of-pocket medical and non-medical expenses, regardless of the type of

medical plan offered by their employer. This is surprising, given that there has been concern that high deductible health plans (HDHPs) increase

the potential burden of out-of-pocket expenses on employees due to high deductibles and high out-of-pocket maximums. As shown in Exhibit 5,

the average score for employees with HDHPs is 51, comparable to scores for employees with point of service plans (58), health maintenance

organizations (51), and preferred provider organizations (48).

Average illness/injury benchmark score for employees whose employers

Offer disability coverage82

Do not offer disability coverage56

25 Council for Disabili ty Awareness, 2014 Long Term Disability Claims Review.


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Exhibit 5: Out-of-Pocket Expenses Benchmark Scores by Medical Plan Type

Plan Type Score

Point of Service (POS) 58%

High Deductible Health Plan (HDHP) 51%

Health Maintenance Organization (HMO) 51%

Preferred Provider Organization (PPO) 48%

Source:Prudentials Financial Wellness Survey, 2014.

BEST PRACTICES TO HELP IMPROVE EMPLOYEES FINANCIAL WELLNESS

Employers have a real opportunity to improve their employees financial wellness through the introduction of programs that educate employees

about the financial risks they face and provide the tools they need to manage those risks. Here are some best practices employers may want to

consider when creating a financial wellness program:

1. Adopt a needs-based approach to promoting benefits.Many employers try to improve their benefits programs by tracking product penetration levels the degree to which employees select various

benefit offerings and attempting to boost the uptake of those offerings that have low penetration levels.

Employers may have a greater impact on their employees financial wellness by analyzing product penetration levels relative to employee needs

rather than focusing on product penetration levels alone. As part of that effort, employers may want to:

u Leverage employer-based tools to gauge the financial wellness of an employee population. Partner with a provider that can

measure the financial wellness of your employee population and understand the drivers behind those measures. Compare your employees financial

wellness measures to relevant benchmarks based on industry, region, and/or company size.

u Set financial wellness goals for the employee base.

Identify demographic segments within the employee population where financial

wellness measures are below established benchmarks and goals.


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u Measure employees financial wellness on an ongoing basis. Regular monitoring will help gauge the effectiveness of education

and communication programs.

u Target employee segments that have large coverage gaps with customized communications. Consider providing employees

with targeted case studies and educational videos with profiles relevant to their own situations. Use a variety of communication

channels to appeal to a wide range of employee preferences for receiving information.

2. Educate employees on financial wellness, emphasizing both needs and solutions.

Define and communicate the importance of attaining a high level of financial wellness. Help employees understand their exposure to key

financial risks by providing statistics on the chances and financial implications of premature death, disability, being diagnosed with a critical

illness, or being in an accident. Illustrate how specific solutions increased saving, increased insurance coverage, healthier lifestyles, or some

combination of the three can help mitigate financial risks. (See Exhibit 6 for more on how education may help overcome employees obstacles

to buying insurance.)

3. Leverage existing educational tools and channels.

Where possible, provide customizable tools integrated with existing online enrollment systems. Take advantage of customized enrollment

support from benefits providers, who can answer employees questions, conduct needs analyses for them, and provide them with personalized

coverage recommendations.

4. Take a holistic approach to critical illness, accident, and other insurance by offering a suite of solutions.

Premature death, illness or injury, and out-of-pocket medical and non-medical expenses are insurable risks that can be mitigated through

life, disability, critical illness, accident, and other insurance. Employers should consider including these solutions in their core benefits lineup.

To further boost financial wellness, employers may want to offer health and wellness programs, savings programs such as 401(k) plans,

matching contributions to 401(k) plans, and health savings accounts. Providing a robust array of benefits can also give employers a

competitive advantage in attracting and retaining workers.26

A needs-based approach to promoting employee benefits analyzes product

penetration levels relative to employee needs. This may have a more powerful

impact on financial wellness than current approaches because it ties employees

needs to how well positioned they are to cover those needs.

26Towers Watson, Attracting and Keeping Employees: The Strategic Value of Employee Benefits, May 2014.


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Exhibit 6: Education May Drive Employees to Make Better Use of Insurance

People typically are not eager to buy products they do not understand or appreciate. Research conducted by the Center for Retirement

Research at Boston College and sponsored by Prudential27confirms that while many employees do not fully appreciate the benefits

provided by life and disability insurance and hence make suboptimal use of it education could help them overcome their resistance

to it and improve their financial well-being. Among the surveys key findings:

u While employees do not think about life insurance very often, they do think about it during key life events such as getting married,

having a child, or purchasing a home.

u Individuals have a narrow view of life insurance. They view it as a means to pay down current and future debts, but often overlook

its ability to help cover their dependents day-to-day living expenses.

uEmployees are confused about disability insurance. Specifically, they:

Underestimate the likelihood of prolonged disability, which they define narrowly as a catastrophic illness or injury resulting from

a high-risk occupation or lifestyle.

Overestimate the level of coverage provided by their safety net, expecting to be fully covered for disability by workers compensation,

short-term disability insurance, or Social Security disability benefits.

Struggle to evaluate the cost of disability insurance.

Drawing on behavioral finance concepts, the Center for Retirement Research devised and tested various hypothetical interventions that

might be used during online enrollment periods to help employees make smarter choices about insurance benefits. Several proved effective,

including providing default coverage levels, checklists, personalized estimates, information on monthly income that may be generatedfrom specified coverage levels, and information on the risk of disability.28

27Prudential, Consumer Insight Reveals Opportunities to Improve Financial Wellness, 2012. CRR partnered with Greenwald & Associates to conduct 24 in-depth telephoneinterviews with consumers in 2012. 28Prudential, Consumer Insight Reveals Opportunities to Enhance Effectiveness of Enrollment Sites, 2013.


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CONCLUSION

Employers have widely accepted health and wellness programs, which benefit employees and employers alike. Like health and wellness programs,

needs-driven financial wellness programs promise to benefit employers as well as employees.

The opportunity is great. Prudentials measure of financial wellness, Prutection ScoreSM, indicates that right now, the average full-time U.S. employee

with medical insurance coverage would not be able to meet all of the expenses relating to any one of three key risks, identified by Prudential in this

paper, that threaten his or her financial well-being. On average, he or she could cover only 71% of financial needs in the event of premature death,

71% of financial needs in the event of loss of income due to illness or injury, and 48% of out-of-pocket medical and non-medical expenses in the

event of an accident or critical illness.

These findings suggest that employers have a real opportunity to help improve their employees financial health through targeted, needs-based

financial wellness programs, which educate employees about the financial risks they face and provide the tools they need to help manage them.

Offering a broad array of insurance programs can be an important component of that effort. Life, disability, critical illness, accident, and other

insurance programs, paired with medical insurance, can address many of the financial risks employees face every day. To cite just one example,

employees whose employers provide disability insurance have an average illness/injury benchmark score of 82, versus just 56 for employees

whose employers do not offer that protection.

Needs-based financial wellness programs can improve on conventional approaches to promoting employee welfare. Until now, most employers

have assessed the effectiveness of their various benefits programs, and decided which to promote, by comparing the percentage of workers using

them to pre-established product penetration goals. Using the benchmark scores and/or calculating scores for their own employee populations,

employers can target their efforts to the specific employee groups who need them the most.


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About the survey

Financial wellness scores are based on a national survey of full-time employees who have medical insurance.

Sponsored by The Prudential Insurance Company of America, 5,335 surveys were completed between March 5 April 2, 2014,

using Harris Online Panel.

Questions covered demographics, income, expenses, savings (emergency and investments), ownership of protection products,

and confidence levels.

Data has been weighted by representation within industry and in total on these factors: education; age by gender, race, and ethnicity;

four census regions; income; company size; and percent self-employed.

Weights rely on statistics from the U.S. Bureau of Labor Statistics and U.S. Census Bureaus Current Population Survey, and Dun and Bradstreet.

For additional information, visitwww.research.prudential.com Eighth Annual Study of Employee Benefits: Today & Beyond

Managing Financial Risk in Retirement and Benefits Programs

Critical Illness Insurance: On the Road to Financial Wellness

Accident Insurance

National Retirement Risk Index

ThePrutection Score SMis a measure of how prepared a group of employees are for the risks of (1) premature death, (2) loss of income due to an illness or injury and (3)out-of-pocket expenses related to an illness or injury. For each of the three risks, the Prutection Score SMis the ratio of Funds Available to Funds Needed, which, are estimatedusing employee demographic information, Prudential survey data and a variety of credible external industry and government sources. The Prutection Score SMis not intended toadvise you or any of your employees what their specific financial needs might be or the exact amount of coverage any one individual might need now or in the future. Individualsshould contact a financial professional regarding your personal situation. The resulting scores are to be used for an entire group of employees or large demographics within agroup. Results are not to be used at an individual level. Prudential is not responsible for uses made of this information inconsistent with the description provided here.
http://research.prudential.com/http://research.prudential.com/


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This policy provides ACCIDENT insurance only. It does NOT provide basic hospital, basic medical, or major medical insurance as defined by the New York Departmentof Financial Services.

IMPORTANT NOTICE THIS POLICY DOES NOT PROVIDE COVERAGE FOR SICKNESS.

This policy provides disability income insurance only. It does NOT provide basic hospital, basic medical, or major medical insurance as defined by the New York Departmentof Financial Services.

North Carolina Residents: THIS IS NOT A MEDICARE SUPPLEMENT PLAN. If you are eligible for Medicare, review the Guide to Health Insurance for People with Medicare,which is available from the company.

These Critical Illness and Accident coverages are not comprehensive health insurance coverage (often referred to as Major Medical Coverage).

They do not satisfy the Individual mandate of the Affordable Care Act. They do not meet the requirements of minimum essential coverage as defined by federal law.

Group Critical Illness Insurance coverage is a l imited benefit policy issued by The Prudential Insurance Company of America, a Prudential Financial company, 751 Broad Street,Newark, NJ 07102. Prudentials Critical Illness Insurance is not a substitute for medical coverage that provides benefits for medical treatment, including hospital, surgical and medicalexpenses, and does not provide reimbursement for such expenses. The Booklet-Certificate contains all details, including any policy exclusions, limitations,, and restrictions, which mayapply. If there is a discrepancy between this document and the Booklet-Certificate/Group Contract issued by The Prudential Insurance Company of America, the Group Contract willgovern. A more detailed description of the benefits, limitations, and exclusions applicable are contained in the Outline of Coverage provided at time of enrollment. Please contactPrudential for more information. Contract provisions may vary by state. Contract Series 114774.

Group Accident Insurance coverage is a limited benefit policy issued by The Prudential Insurance Company of America, a Prudential Financial company, 751 Broad Street, Newark, NJ07102. Prudentials Accident Insurance is not a substitute for medical coverage that provides benefits for medical treatment, including hospital, surgical and medical expenses, anddoes not provide reimbursement for such expenses. The Booklet-Certificate contains all details, including any policy exclusions, limitations,, and restrictions, which may apply. If thereis a discrepancy between this document and the Booklet-Certificate/Group Contract issued by The Prudential Insurance Company of America, the Group Contract will govern. A moredetailed description of the benefits, limitations, and exclusions applicable are contained in the Outline of Coverage provided at time of enrollment. Please contact Prudential for moreinformation. Contract provisions may vary by state. Contract Series 83500.

Group Life and Disability coverages are issued by The Prudential Insurance Company of America, a Prudential Financial company, 751 Broad Street, Newark, NJ 07102. The Booklet-Certificate contains all details, including any policy exclusions, limitations, and restrictions, which may apply. Contract Series 83500.

2015. Prudential, the Prudential logo, the Rock symbol, and Bring Your Challenges are service marks of Prudential Financial, Inc. and its related entities, registeredin many jurisdictions worldwide. 152208

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