The Aviva relocation trends report Insights, challenges and solutions to aid successful relocation
Contents 3 Introduction 4 Relocation trends 6 What makes people want to experience a new country? 7 Challenges posed by foreign assignments 8 The relocation package 10 A focus on healthcare 11 How Aviva can help How we did this research We commissioned extensive research among 1,500 UK adults. In addition, we canvassed opinions from a panel of 230 UK adults who work in a company with over 1,000 employees and are in charge of sending employees to offices abroad. The sample is broadly representative of the UK across age, gender and region. This research was conducted during April and May 2012, online, on behalf of Aviva by independent research company One Poll.
Introduction As an experienced international medical insurance provider, we re keen to understand the trends in international relocations and challenges being faced by employers. We use this information, together with our own insights as a global employer, to develop communications that support our customers. This approach also helps inform and consistently improve our international private medical insurance products. For the past three years, Aviva has carried out its semi-gration research with consumers to understand how they d feel about working abroad, where they d like to live and their expectations and concerns about the move. This year, we ve extended our research to include the views of over 200 employers responsible for relocating employees placed on foreign assignments. The results are thought provoking. They highlight many of the challenges faced by employers the most pertinent, perhaps, being the fact that the countries in which employers are now choosing to operate are not areas that employees favour. In this report we shine a light on a number of the challenges that employees and employers face in relation to foreign assignments, and also offer some solutions to those problems. We hope that you find it a useful insight into international relocation. Relocation trends l One in five (21%) employers who manage international assignments say they ve sent more employees abroad over the past few years. Two thirds are looking to maintain or increase their current level of international assignments over the next few years. l Over half (58%) of employers are looking to relocate staff in new territories. The emerging BRIC economies (Brazil, Russia, India, China) feature highly on the list of destinations. l Just under half the employees we spoke to said they d considered a move abroad a third have friends or family who ve moved abroad in recent years. For more details please see pages 4-5 Challenges posed by foreign assignments for employers who send employees abroad l 68% of employers describe the relocation process as challenging. l Nearly half (47%) have experienced a failed international assignment. l 60% say they find the rules and regulations surrounding foreign assignments to be prohibitive and complex. For more details please see page 7 The relocation package l Over half the employers responsible for managing foreign assignments say they struggle to get the rewards package right. l 57% provide international private health insurance for their employees making it the second most offered benefit behind housing allowance. l Employers also offer support such as information about the region, contact with people already living in the area and counselling. l The benefits that employers are offering closely match the benefits employees say they want. For more details please see pages 8-10 3
Relocation trends Foreign assignments are still proving to be attractive for many companies. One in five (21%) employers who manage foreign assignments say they ve sent more employees abroad over the past few years. Moreover, two thirds are either looking to maintain their current level of international assignments or increase them in the near future. In the main, macro-economic issues have prompted businesses to consider international openings. Over half (55%) of the businesses we spoke to are targeting alternative countries for new commercial opportunities. Meanwhile, 29% think there is an opportunity to make more money in overseas markets. Which countries are employers choosing for foreign assignments Our research reveals that employers are spreading their net further to exploit new business opportunities in the globalised marketplace. Over half (58%) are sending staff overseas to the emerging BRIC economies this year: China (41%), India (41%), Russia (25%) and Brazil (25%) feature prominently on the list of destinations. How long would you be prepared to stay abroad? 37% 11% 3% 9% 21% 19% Interestingly, many of these locations also feature highly in the list of countries that employees would rather avoid. Destinations such as the USA, Australia and Spain are still a preferable choice. Not surprisingly, political unrest (64%) is a key reason given for being reticent to move. Other factors include a fear for personal safety (59%), the country being too culturally diverse (42%) and a concern that there would be difficulties communicating if English isn t widely spoken (38%). Less than six months Six months to a year One to three years More than three years but not permanently I d move abroad permanently As long as my employer wanted me to 4 The Aviva relocation trends report
Most popular new territories for foreign assignments are: 1) India 2) China 3) Russia 4) Brazil 5) Australia 6) USA 7) UAE Top countries employees would choose to live: 1) USA 2) Australia 3) Spain 4) France 5) New Zealand 6) Italy 7) Canada Countries that employees say they wouldn t like to move to 1) India 2) Africa 3) UAE 4) Eastern Europe 5) Far East 81% of employers send their employees abroad for up to five years. 5
What makes people want to experience a new country? Just under half the people we spoke to said they d considered the prospect of moving abroad. A third have friends or family who have moved overseas to work in recent years. Today s work-hard culture appears to be playing a role in this trend. Over half (60%) admitted they re having to work harder than ever before and 36% said their work-life balance has deteriorated over the past few years. Given these statistics, it s not surprising to learn that many of the people considering a move abroad are searching for a sunnier climate and a less pressurised lifestyle. Nearly seven out of ten (67%) said that living in a better climate is appealing, and 57% say they d like a better quality of life. Just over half (51%) would like a better work-life balance. Over half (59%) believe they d feel less stressed if they lived in a country with a better climate and more opportunities for outdoor living. A further 49% of employees feel they d lead a healthier lifestyle abroad. This is based on the perception that the work-life balance is better in other countries a view shared by just 14% of employers. However, over a quarter of employers agree that employees based overseas do tend to have a better quality of life. What factors factors would would influence influence your your decision decision to relocate to relocate abroad? to your preferred country? 80% 70% 60% 50% 40% 30% 20% 10% 68% 67% 40% 46% 32% 31% 18% What factors appeal to you about working abroad? 38% 42% 45% 24% 21% Better climate 50% Better quality of life 67% Better work-life balance 51% Opportunity to experience a different culture Living a healthier lifestyle Lower cost of living Opportunity to make more money 31% Less crime Better benefits 18% 15% 57% It B G S I S B H N I 0% It has a good climate Better quality of life Good work life balance Safe place to live I speak the language Similar culture Better economy Healthier lifestyle Not too far away I know people there 6 The Aviva relocation trends report
The challenges posed by foreign assignments A similar number (56%) say that it s challenging to deal with employees concerns It has a good climate and demands. Around half say they find it particularly difficult to get families Better quality of life settled in the new location. Good work/life balance Safe place to live 50% say that getting the benefits package right is a significant challenge. I speak the language Similar culture Better economy Given the complexities associated with relocation, it s not surprising that 68% of employers described the relocation process as challenging. Not only is there a whole raft of legislation and regulation to deal with, there are also the issues associated with different cultures each one with its own unique customs. Three in five (60%) employers say they find the rules and regulations regarding things like health provision to be prohibitively complex. Almost half have experienced failed international assignments Healthier Lifestyle Given these challenges, we weren t surprised to learn that nearly half (47%) these Not too far away businesses had experienced failed international assignments. The main reason given I know people there for employees returning home early was being homesick - missing friends and family. The trend towards relocation in more culturally diverse countries could exacerbate that issue in the future especially considering that two of the main reasons for employees returning home are cultural (37%) and language (26%) barriers. Main reasons employers give for employees wanting to return home 36% 32% 37% They missed their friends and family Only saw it as a short- term move Couldn t cope with cultural barriers Were missing their previous lifestyle Wanted to return home to raise their family 54% 47% Employers find it easiest to relocate employees under thirty-five or over fifty. Employees in their 40s married with children are the most challenging to relocate. 7
The relocation package Although half the employers we spoke to admit they struggle to get their rewards package right, our research reveals that employees health and wellbeing is a key priority. Over half (57%) say they want to be sure their staff can access medical support when it s needed and that treatment is paid for (43%). Three quarters of employers include international health insurance as part of their relocation package, placing it the second most offered benefit behind housing (78%). Other widely offered benefits include paying expenses (72%), arranging schooling (52%) and life insurance (40%). International private health insurance purchasing behaviours Of the 75% who said they offer international private medical insurance as part of their relocation package, the majority of those employers (59%) take out a group international private medical insurance scheme for employees based abroad. Two in five (40%) arrange their insurance through a specialist broker while a similar number (38%) go direct to the insurer. Employers take a number of factors into Main account reasons when purchasing employers international give for employees private medical insurance. wanting These to return include: home 24% 50% 32% 4% 41% 46% Most popular employee benefits offered as Most part popular of the employee relocation benefits package offered as part of the relocation package 90% 80% 78% 70% 75% 72% Quality of package Global strength Expertise in IPMI market Value for money Known trusted brand Comprehensive benefits 60% 50% 40% 30% 52% 43% 41% 40% 37% 20% 10% 0% 21% 17% 14% 4% Housing Private health insurance Expenses Schooling Car Travel insurance Life insurance Dental cover Home insurance Income protection Motor insurance Pet insurance 8 The Aviva relocation trends report
International private medical insurance gives staff the peace of mind that they can access medical support whenever they need it. However, we shouldn t lose sight of the fact many assignments fail because employees don t have the emotional support they need to help them settle into a new culture. Giving staff access to additional services, such as access to a doctor 24 hours a day and specialist counselling support, can make all the difference. Teresa Rogers, business lead, international, Aviva, UK Health Additional support Just under half (45%) of the people who dream of working abroad (but have not yet taken the steps to do so), say they re reluctant to leave their friends and family. The same number worry about the cost of relocating. A third say they re concerned about the practicalities of living abroad, such as arranging housing, schooling and healthcare, and in addition, it s apparent that many people worry how they d settle into a new country: 31% of people would worry that they d feel isolated 30% say they d worry that their family wouldn t be happy 29% worry that they wouldn t have a support network 19% worry how they d adapt to a different culture. The good news is that it looks as though employers are already going some way to help overcome these concerns. The majority (60%) say they prepare their employees well in advance for the move with half saying they arrange everything on their employees behalves. Moreover, employee support extends beyond traditional employee benefits. Many companies are already offering the support that people say would help make the transition abroad easier, for example; being put in contact with a colleague already living in the country, or being given regional insights and information about healthcare provision. Giving employees access to a helpline to answer any questions can also help make the relocation process less traumatic. Information about the region Put them in contact with a colleague Information about local health provision We arrange everything Give them a helpline to call Offer counselling services Little or no support What support do you give your employees? Support offered by employers Talking to another employee in the area Information about healthcare provision Having a helpline to call Information about the area Having someone to discuss concerns with My employer arranging everything My employer paying for private medical insurance My employer arranging other insurances 7% 30% 38% 50% 54% 70% 69% 0 10 20 30 40 50 60 70 80 Support employers think would make the transition easier What support do employees think would make the transition easier? 21% 31% 30% 33% 37% 36% 42% 41% 0 10 20 30 40 50 9
A focus on healthcare We were pleased to see that employees health and wellbeing is a key priority for employers looking to deploy staff overseas. Over half (57%) of employers said their main priority is knowing that staff can access medical treatment when it s needed 34% want to know that employees have access to medical support 24 hours a day. Just under half (43%) said they like to know that treatment will be paid for in situ, and a similar number (44%) want to be confident their staff would have support in a medical emergency. When we asked employers what their employees main concerns were, during a period of illness, just over a quarter (27%) said they wanted to be confident of having prompt access to support and advice. A similar number (24%) said that employees wanted to be assured of access to the medical treatment and drugs that would help them return to health. Interestingly, waiting lists don t appear to be a concern. Only 3% of employers said that their employees would worry about the length of time they d have to wait for treatment abroad. Instead, the main issues appeared to be: language barriers (54%) quality of treatment (50%) cultural difference in the way they d be treated (24%) concerns about potentially different approaches to medicine abroad (17%). What are your key priorities What about are your your key priorities about your employees health when employees' they re abroad? health when they're abroad? Knowing they can access the treatment they need 57% Understanding what happens in a medical emergency situation Knowing that treatment will be paid for Understanding how the local health system works 41% 44% 43% Knowing that employees have access to 24 hour medical support 34% Knowing that employees can be repatriated 20% Being kept up to date with employee s progress Having access to a health expert and support 15% 15% 0 10 20 30 40 50 60 42% of employees want to know that their medical treatment is paid for when they re abroad. 30% of employers believe that the UK has better health benefits than other countries worldwide. 10 The Aviva relocation trends report
How Aviva can help At Aviva we help our customers navigate their way through healthcare legislation and provide tailored solutions to their healthcare needs. This includes flexing product benefits to complement health systems in different regions and ensuring compliance in areas such as the UAE. We ve also set up a special network arrangement in the US, offering our customers additional security, dedicated support and ease of access to medical care. Aviva s International Solutions policy is available to individual and corporate customers. It s a highly flexible product offering a choice of additional benefit and cost containment options to complement the extensive core cover. Customers can choose from six additional benefit options including a wellness benefit that provides up to 500 cover towards routine tests and examinations, up to 10,000 maternity cover and the option to increase out-patient cover. Alternatively, they can reduce costs by choosing one of three cost-saving options. These include; reducing their outpatient cover, choosing an alternative excess or removing specific benefits. Aviva s International Solutions policy includes a wide range of additional support including online support, round-theclock medical assistance, a 24 hour medical information helpline and My Health Passport a secure online system that enables customers to store and access their medical records while they re abroad. If a customer falls ill, we do everything we can to make it easy for them by accepting copies of invoices and claim forms, arranging treatment on their behalf, paying bills direct and offering multi-lingual helplines. Moreover, Aviva customers have exclusive access to StandbyMD a 24 hour healthcare service available in 4,000 cities, across 86 countries. StandbyMD gives Aviva customers the peace of mind that they can talk to a doctor at any time of the day or night. They can also arrange prompt access to a face-to-face consultation or home visit. Aviva has also recently partnered with PPC Worldwide to offer its customers an Employee Assistance Service at preferential rates. 11
Aviva Health UK Limited. Registered in England Number 2464270. Registered Office 8 Surrey Street Norwich NR1 3NG. This insurance is underwritten by Aviva Insurance UK Limited. Registered in England Number 99122, Registered Office 8 Surrey Street Norwich NR1 3NG. Authorised and regulated by the Financial Services Authority. Aviva Health UK Limited, Head Office: Chilworth House Hampshire Corporate Park Templars Way Eastleigh Hampshire SO53 3RY. aviva.co.uk/health GEN4628 06/2012 Aviva plc