Is Your Plan Evolving with Gender Norms?

Diversity, equity and inclusion has become a critically important consideration, but a lot needs to change in the pension and benefits industry to adequately address it. This Q&A with Karen DeBortoli, Director, Knowledge Resource Centre and Canadian Privacy Officer with Buck, explores some of the key issues.

How has the emphasis on DEI impacted the pension and benefits industry?

To be effective, pension and benefit plans must meet the needs of both plan sponsors and members. The current sociopolitical climate has caused many stakeholders to take a fresh, critical look at how their plans are (or aren’t) meeting the needs of all members – particularly those in traditionally under-represented communities – and their beneficiaries.

When it comes to transgender, non-binary/genderqueer and gender non-conforming members, plans, providers and regulators are embracing many inclusive changes. Employers are updating plan texts, communications, enrollment forms and other materials to remove gendered language. Many are also expanding their plans to offer benefits tailored to the trans or gender non-binary community, such as gender transition coverage.

Systemic changes are being considered. For example, the Canadian Institute of Actuaries has established a task force on gender identity, looking at the impact on actuarial work of either replacing sex with gender or removing consideration of sex/gender from plan administration and/or costing. Insurers are also evolving their products and practices to recognize the spectrum of gender identity.

In your presentation at the Canadian Employer Outlook virtual conference last November, you explained that you polled insurers on how they are handling unnamed, undisclosed gender from an administrative standpoint. What are some of your key findings?

The short answer is, there is currently no “standard” approach: the approaches adopted vary by insurer and, frequently, by benefit.

I spoke with five major Canadian insurers about the impact of gender on premiums, asking whether they use unisex rates, sex-distinct rates or a mix of the two, depending on the benefit involved. One insurer uses unisex rates for all products, while another uses sex-specific rates for all products. Two other insurers fall in between these extremes, using either sex-specific or unisex tables based on the product – or, in some cases, based on what the plan sponsor requests. Given the range of benefits they offer, the fifth insurer sets premiums based on group experience.

Approaches also vary regarding the treatment of trans and gender non-binary members where premiums are determined by gender. One automatically considers every such member as male, while others use the gender that a member indicates they identify as or prefer. Clearly, there are cost implications for the plan sponsor and members, depending on the approach used, but plan sponsors may not be aware of the different treatment and impact on their plan.

Do you have any recommendations for plan sponsors (or the industry at large) on handling this issue?

For plan sponsors, my recommendation would be to ask questions – of their organization, their membership and their service providers. For example:

  • Is there a match or mismatch between your benefit plan offerings and member demographics?
  • Are there specific benefits you can offer that meet the unique needs of specific communities, such as trans and gender non-binary members?
  • Do traditionally under-represented groups feel their plans meet their needs?
  • Are there benefits these groups need that they aren’t getting?
  • Do any of your members face obstacles to participating in plan committees or advisory groups?
  • How do service providers treat and cost individuals who identify as trans and gender non-binary?
  • Do providers offer specific benefits to meet those members’ needs? If not, why not?

The industry at large would benefit from some consistency and guidelines regarding the use of unisex vs. sex-specific rates by insurers – particularly in the treatment of trans and gender non-binary members where sex-specific rates are used. Until that happens, plan sponsors should be sure to ask questions of their insurers and perhaps even consider switching providers, depending on the answers they get.

Alyssa Hodder
Director, Education and Outreach – Canada

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