Archive for the ‘Towers Watson’ Category

Insurers risk being sidelined by internet-savvy consumer generation

April 8, 2015 Comments off

Insurers risk being sidelined by internet-savvy consumer generation
Source: Towers Watson

Scarred by the financial crisis, price conscious buyers aged under 30 are driving a fundamental shift in how insurance is bought, according to Towers Watson. A survey of over 7,000 consumers across Europe’s largest and fastest-growing markets – including the UK, France, Germany and Turkey – found the advance of technology increasingly distancing the millennial generation of buyers from traditional purchase channels and sources of advice and influence.

The survey, The shifting balance of power, also found many under-25s to be far more risk aware and interested in financial security than previously thought, underlining the need for insurers to find new methods of engaging with these younger buyers.

Nearly Half of U.S. Employers Expected to Hit the Health Care “Cadillac” Tax in 2018 with 82% Triggering the Tax by 2023

October 27, 2014 Comments off

Nearly Half of U.S. Employers Expected to Hit the Health Care “Cadillac” Tax in 2018 with 82% Triggering the Tax by 2023
Source: Towers Watson

Despite continuing efforts to rein in rising health care costs, roughly half of large U.S. employers will begin to hit the excise tax in 2018 and the percentage is expected to rise significantly in subsequent years, according to an analysis of large employer health care programs conducted by global professional services company Towers Watson (NYSE, NASDAQ: TW). Further, the size of the tax burden is expected to be substantial as the Congressional Budget Office (CBO) estimates the total liability for companies subject to the tax could be a cumulative $79 billion between 2018 and 2023.

Implemented as part of the Patient Protection and Affordable Care Act (PPACA), the excise or “Cadillac” tax is a 40% tax on the value of all affected health care programs a participant elects that exceed certain dollar thresholds in 2018 and beyond. This non-deductible excise tax must be paid by the employer (although some employers are contemplating charging the tax back to plan participants). A recent Towers Watson survey found that 73% of companies are very or somewhat concerned they will trigger the tax, and 62% say it will have a moderate or greater impact on their health care strategy in 2015 and 2016. The analysis revealed that 48% are likely to trigger the tax in 2018 and 82% could cross the threshold by 2023.

Compensation for U.S. Corporate Directors Increased 6%, Towers Watson 2014 Analysis Finds

October 24, 2014 Comments off

Compensation for U.S. Corporate Directors Increased 6%, Towers Watson 2014 Analysis Finds
Source: Towers Watson

Total pay for outside directors at the nation’s largest corporations increased by 6% in 2013, fueled by higher stock-based compensation, according to a new analysis by global professional services company Towers Watson (NYSE, NASDAQ: TW). The study also found that cash compensation remained flat for the first time since 2007, when proxy disclosure rules were enacted requiring companies to report actual values received by directors in summary compensation tables.

According to Towers Watson’s annual analysis of director compensation at Fortune 500 companies, median total direct compensation for directors climbed 6% last year, to nearly $240,000, up from $227,000 in 2012. The increase is double the 3% increase in director total compensation in 2012. Total compensation includes cash pay, and annual or recurring stock awards. The analysis found that the median value of cash compensation remained flat last year at $100,000, while compensation from annual and recurring stock awards increased 4%, to $130,500, the largest increase since 2011. More than half (56%) of directors’ pay in 2013 was delivered through stock compensation, up slightly from 55% in 2012.

Which Employees Are Delaying Retirement and Why?

October 13, 2014 Comments off

Which Employees Are Delaying Retirement and Why?
Source: Towers Watson


  • 34% of workers under 40 believe that retirement delays among older workers are restricting their career opportunities.
  • Aside from retirement savings, health and stress have the strongest links to retirement timing.
  • Offering employees greater retirement security can help employers cultivate a less stressed, healthier and more engaged workforce.

Nearly One in Four Employers Say Private Health Insurance Exchanges Could Provide a Viable Alternative for Full-Time Active Employees in 2016

September 30, 2014 Comments off

Nearly One in Four Employers Say Private Health Insurance Exchanges Could Provide a Viable Alternative for Full-Time Active Employees in 2016
Source: Towers Watson

Results of a July 2014 survey of midsize to large employers by global professional services company Towers Watson (NYSE, NASDAQ: TW) showed that 28% said they had already extensively evaluated the viability of private exchanges. Nearly one in four (24%) said private exchanges could provide a viable alternative for their active full-time employees as soon as 2016.

The results are from the 2014 Towers Watson Health Care Changes Ahead Survey, which was completed by 379 employee benefit professionals from a variety of industries and reflect health care benefit decisions for 2016 – 2017.

The survey also revealed that the top three factors that would cause employers to adopt a private exchange for full-time active employees are:

  • Evidence they can deliver greater value than their current self-managed model (64%)
  • Adoption of private exchanges by other large companies in their industry (34%)
  • An inability to stay below the excise tax ceiling as 2018 approaches (26%)

Renovating HR for the New World of Health Care

September 23, 2014 Comments off

Renovating HR for the New World of Health Care
Source: Towers Watson

For a variety of reasons, the health care industry has failed to keep pace with the drive for efficiency seen across much of corporate America in the last decade, when most HR functions streamlined processes, eliminated paper and centralized administrative activities. But with historic transformation shaking up the industry, HR is acting fast now to initiate needed change. Towers Watson’s 2014 HR Service Delivery and Technology Survey highlights several trends in efficiency and effectiveness taking hold these days: building and expanding employee service center approaches, leveraging self-service and HR portals, as well as the evolving roles of both centers of expertise and entity HR.

Thinking about transforming your HR service delivery model can be daunting. The first step is to clearly understand what the function is doing today and what your organization’s leadership wants from HR. HR leaders need to be actively engaged with senior management to understand the workforce implications of the transformation within the organization. Once you understand the gaps between the current state and desired future state, you can begin to create a new service delivery model and reset the priorities for both the function and its leadership.

The world’s 300 largest pension funds – year end 2013

September 3, 2014 Comments off

The world’s 300 largest pension funds – year end 2013
Source: Towers Watson

Total assets of the world’s largest 300 pension funds grew by over 6% in 2013 (compared to around 10% in 2012) to reach a new high of almost US$15 trillion (up from US$14 trillion in 2012). The P&I / Towers Watson global 300 research is conducted in conjunction with Pensions & Investments, a leading US investment newspaper.

Latin American and African funds had the highest five-year combined compound growth rate of over 16% (albeit from a low base) compared to Europe (12%), North America (around 6%) and Asia-Pacific (around 5%).

Defined benefit (DB) funds account for 67% of total assets, down from 75% five years ago. During 2013, DB assets grew by around 3%, compared to reserve funds (15%), defined contribution (DC) plans (over 9%) and hybrids (over 8%).

Sovereign funds continue to feature strongly in the ranking with 27 of them accounting for 28% of assets and totalling around US$4.2 trillion. The 113 public sector funds in the research had assets of US$5.8 trillion in 2013 and account for 39% of the total. Private sector industry funds (61) and corporate funds (99) account for 14% and 19% respectively of assets in the research.