Flexible / Lump Sum Policies – Does Flexibility Equal Happiness

Flexible / Lump Sum Policies were first introduced in the 1990’s recognizing that a “one size fits all package” doesn’t always work.

Beginning in the 1990’s a trend emerged to introduce more flexible approaches to expat policies, even to the point of consolidating multiple policy benefits and calculating a single lump sum allocated by individual assignee according to their specific needs. This option remains a continued area of interest to companies today, especially those operating under a belief that modern “Gen Y” assignees are perhaps more inclined to embrace such flexibility. Access to information and services has never been greater and many employees, both young and old, prefer the freedom of choice. Technology has provided us with a highly customized experience in many aspects of our lives, why not apply that same concept to relocation benefits? Seems like a win-win for all─the employee gets to shape their own relocation experience and relocation administrators have fewer exceptions and services to manage. Quite the ideal scenario! Or is it? This paper examines the current state of competitive practice of flexible/lump sum policies, the lessons learned and how they can be applied.

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