LONDON – UK companies can start the year by saving up to 35% on their benefit costs if they review their current employee benefit packages such as group life assurance, income protection or Private Medical Insurance says Hewitt Associates, a global human resources consulting and outsourcing company. Hewitt's analysis shows that companies are missing out on significant cost savings by not renegotiating their current benefit contracts.

Colin Bullen, head of Health & Risk Benefits at Hewitt Associates, said:

"Companies are losing out by not reassessing their current contracts. Shrinking budgets, coupled with the effects of the recession, have presented an opportunity to review and reset priorities. In many instances, benefit providers have become extremely competitive on price and are willing to adjust their rates to attract and retain business – a situation that is unlikely to last indefinitely. Savings are realistically achievable if companies act now. For example, a company with 1,000 employees could save up to £200,000 per benefit conserving essential capital during this tough economic period.
        
"By seizing this opportunity, more advantageous terms for the next two to three years may be on the table; meaning that companies can lock in significant savings without damaging employee morale."

Hewitt also believes that companies should not fall into the trap of simply cutting benefits to cut costs. While this may seem to be a short-term solution, it does not lead to long-term advantages.

Colin added: 

"In these challenging operating conditions, it is vital that companies are not seduced by short-term benefit cuts. Blanket benefit cuts do not lead to enduring business advantages. We are urging companies to start 2010 by acting with an eye to the longer term.  A well-structured benefits policy that is valued by employees typically results in more engaged employees and is proven to boost workforce motivation. Rather than just taking an axe to current benefit structures to control costs, employers should reshape their benefits to meet member needs and demand the best value for money from their providers."

Hewitt urges companies to consider the following framework for review:

• Check when a market review was last undertaken for all health and group risk benefits. 
• Where a review was undertaken 12 or more months previously, contact your adviser to undertake a review. 
• Make sure your adviser is offering competitive terms for the review – some advisers will only charge a fee if they are able to identify net savings for you.
• Evaluate whether a strategic review of benefits might result in short or long-term savings to the business.

About Hewitt Associates
Hewitt Associates (NYSE: HEW) provides leading organisations around the world with expert human resources consulting and outsourcing solutions to help them anticipate and solve their most complex benefits, talent, and related financial challenges. Hewitt works with companies to design, implement, communicate, and administer a wide range of human resources, retirement, investment management, health care, compensation, and talent management strategies. With a history of exceptional client service since 1940, Hewitt has offices in more than 30 countries and employs approximately 23,000 associates who are helping make the world a better place to work. For more information, please visitwww.hewitt.com.