8 Things That Surprised Us Most: Early Findings from the Howden Benefits Benchmarking Report

There’s no doubt that benchmarking where you are against the competition remains a vital step in evaluating the performance of your benefits programme. This is especially true if feedback from candidates and employees is that you are uncompetitive – their input, though useful, is not gospel – you need to validate what they are telling you.

As such, here at Howden Employee Benefits, we set the ambition of building the most comprehensive benchmarking data set and insights in the market and we’re pleased that iteration one of this tool and report is now ready to help HR and Reward professionals make better benefits decisions, for more on better benefits decision making, take a look at our Howden REBA Research 2025.

To whet your appetite for the full Howden Benefits Benchmarking Report, we wanted to share the highlights through the lens of what surprised us most in the data.

1. Pensions: Mind the Middle Gap

One of the biggest surprises was in pension contributions, not the lowest or highest contribution rates, but the space in between.

After a big spike of respondents (20%) contributing 5% of salary as a standard contribution rate, there is then a big dip before that peaks again at 12.5% contributing 10% of salary to their people’s pensions.

It seems many organisations and sectors have chosen between these two points on the contribution scale, leaving very few contributing between 6 and 9% of salary. To us, it seems that enough employers aren’t taking the smaller steps beyond 5% of salary to differentiate themselves and provide better retirement adequacy for their people.

Our view is that more employers could gradually move from 5% to 6%, 7%, or 8% and still make a meaningful difference to long-term retirement outcomes. Sometimes, a modest step is more achievable and would actually set many employers apart.

2. Salary Sacrifice: Still a Missed Opportunity

Although we wait with anticipation (and a small sense of dread) for the impending budget, it is fascinating that over 19% of organisations still aren’t using salary sacrifice for pension contributions.

In some cases, that’s understandable. For instance, where schemes are non-contributory, or where a large proportion of the workforce earns close to the National Living Wage, which limits participation without breaching pay rules.

But these situations likely represent only a small fraction. For most, it’s more about awareness or prioritisation, especially in wake of the Cost of Living Crisis. In today’s environment of rising costs and squeezed margins, salary sacrifice remains one of the simplest, most effective ways to free up savings.

If it’s not yet on the agenda, this is a quick win worth revisiting.

3. Private Medical Insurance: Access and Affordability

It was encouraging to see that 88% of survey respondents provide private medical insurance (PMI) to at least some employees, and around 58% extend it to everyone.

That’s well above the national average, with only around 3.2 to 3.5 million employees covered by company-paid healthcare overall, suggesting our sample reflects more engaged employers. That’s no bad thing, if you want to know what more progressive and supportive employers are doing in each sector.

Even so, the findings reveal room for improvement. In a tight talent market and with continuing pressures on the NHS, making healthcare available for everyone could be a simple way to enhance your offer and support wellbeing.

Interestingly, 72% still require employees to actively opt in rather than being automatically enrolled into healthcare. Although there are tax implications, this feels like a dated approach and making medical insurance an “opt-out” benefit could lift engagement and perceived value dramatically.

And here’s a quirky data point: nearly 80% of PMI schemes still carry an excess of £100 or less, a figure that’s barely moved in decades despite soaring medical costs. There’s clearly a balance to strike between affordability and access, but perhaps it’s time to review whether those thresholds still make sense when inflation has impacted all costs.

4. Health Screening: Time for a Rethink

Health assessments remain a staple benefit, funded by 40% of employers, but mainly for senior staff (half of the 40%) and typically on an annual basis. Yet the role of screening is evolving fast. Affordable home testing kits and data-driven health insights now make it possible to extend preventive care to a much wider audience.

Many employers could extract greater value by broadening access and offering less frequent, more targeted screenings across the workforce. Doing so could promote a stronger culture of prevention without increasing costs, and might even create more engagement than traditional, executive-only health checks.

5. Income Protection: Generosity Under Pressure

We were genuinely surprised by how many employers continue to fund generous income protection schemes (like health benefits, our respondents are perhaps a little more generous and engaged than most with their benefits offer).

58% provide this benefit, and 77% of those extend it to all employees, a notably high level of coverage. Even more striking is that 56% still insure 75% of salary, and the same proportion offer unlimited-term cover that pays benefits up to retirement age.

At a time when premiums are rising and budgets are under scrutiny, this level of generosity stands out. And when you ask employees, it isn’t as valued as you may think.

The question is whether these plans still represent the best use of benefit spend. Nearly half of employers have already shifted to limited-term or lower-percentage schemes, and this may be a more sustainable way forward. Shorter payment terms or reduced replacement rates can still offer meaningful protection and may allow employers to reinvest savings into other wellbeing initiatives that employees value just as much.

6. Flexible Benefits: The Flex Pot Gap

A quarter of employers now offer some form of flexible benefits, which is encouraging, but only 8% provide a dedicated “flex pot” for employees to spend.

That number may surprise some, given how often the concept of flexibility is equated with giving people a pot to spend. In reality, most flex schemes are about choice, rather than funding.

That said, our view is that a well-designed flex pot, especially one that isn’t simply returned to pay if unused, can turbo-charge flexible benefits, as employees understand that if they don’t engage, they are leaving money on the table.

We also found that about one-third of organisations still manage their flex schemes through in-house HR systems or spreadsheets rather than purpose-built platforms. The difference a modern benefits platform can make in data accuracy, employee experience, and ease of communication shouldn’t be underestimated.

7. Wellbeing: Missing the Modern Mix

This one really stood out. Support for menopause, fertility, neurodiversity, and gender dysphoria remains limited, with only around 20% of employers offering these benefits.

That’s surprising because the market is mature, costs are more predictable, and best-practice models are well established.

Inclusive wellbeing is no longer a niche initiative; it has become a mainstream approach. It’s fast becoming an expectation. Employees increasingly look for workplaces that recognise diverse needs and life stages. We expect this to be one of the fastest-growing areas of benefits innovation in the next few years.

8. Annual Leave: Going Beyond 25 Days

We were pleased to see that fewer than 10% of employers now offer less than 25 days’ annual leave, a positive sign. But we were equally surprised that more haven’t moved beyond it – a little bit like the 5% barrier for pension contributions.

Holiday entitlement consistently ranks among the most valued employee benefits. In many sectors, particularly large professional services firms, offering 26 or 27 days (plus buying or “anniversary” options) has become a key differentiator.

For organisations that haven’t reviewed their leave policy in a while, a modest increase could deliver a meaningful boost in satisfaction and retention, often at relatively low cost. And, unlike Group Income Protection (GIP), when you ask them about annual leave, it very often ranks #1.

What’s Next

These early findings reveal just how much benefits design is evolving across UK employers. The data shows both progress and potential. Employers are increasingly engaged in supporting wellbeing, improving financial security, and expanding choice, but there’s still plenty of room to grow for all but the top 15-20% who truly differentiate themselves in their offer.

Our upcoming Howden Benefits Benchmarking Report will explore these themes in more depth, from wellbeing budgets and flexible benefits to financial education and engagement trends.

Please keep an eye out for the full report, which will be available soon. And if you haven’t yet taken part in the survey, there’s still time to add to our data set and get your personalised report in return – a win-win for all. Reach out to your consultant if you are interested in taking part.