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Making the Most of Employer Group Insurance: A Guide for Small Businesses

It’s hard to imagine some of the world’s most well-known companies began as small businesses. Steve Jobs and Steve Wozniak famously developed Apple’s early prototypes in a garage, while Facebook was founded in a college dorm. Modern small businesses had better access to capital than the likes of Apple and Facebook when they started due to the advent of remote work technology. This frees up funds for small businesses to invest in the health and well-being of their staff through initiatives like employer group insurance. But if you’re a small business owner, how do you make optimal use of group insurance?

Read on to discover what group insurance is and how small businesses can make the most of it to survive and thrive.

What’s Employer Group Insurance?

Employer group insurance is a form of health insurance businesses provide to their employees. Companies typically consult an insurance agent to browse various plans before selecting one that suits their budget and their staff’s needs. Thereafter, all employees are signed up for the plan collectively and informed about the dates of their open enrollment period. This refers to a set of dates (typically in the fall) during which employees have the option of switching plans. Open enrollment periods typically last two to four weeks.

Group insurance plans offer coverage at a lower premium than individual health insurance plans. Every employee gets the same coverage, and the company pays for a portion of each staff member’s premiums. The remaining portion of each employee’s premium is taken out of their pre-tax income.

How to Make the Most of Employer Group Insurance as a Small Business

Speak to a Small Business Insurance Services Specialist

A couple of staff members working on their laptops next to a window in their office

Health insurance plans in the US are typically categorized according to tier and coverage. There are four tiers—bronze, silver, gold, and platinum—as well as four levels of coverage. This is important to note because it means there are hundreds of group health insurance permutations to consider. Therefore, it’s vital to hire a small business insurance services expert if you want to avoid spending a massive amount of time sifting through policies looking for one that suits your company.

Insurance agents who specialize in helping small businesses know the employee health insurance marketplace inside out. They’re well-positioned to draft a shortlist of group insurance plans and providers based on your company’s budget and health coverage needs.Some of the best insurance agencies around know exactly what to ask small businesses to surmise what sort of coverage they require. With that said, if you’re a small business owner and/or manager and you’re meeting with an agent to discuss employee insurance services, we recommend proactively discussing a handful of important topics with them. These are summarized below.

Topics to Discuss While Meeting a Small Business Insurance Services Agent

Your Employer Group Insurance Budget

We recommend telling the insurance agent about your budget first,so you don’t spend time looking through plans that’ll take from your company’s bottom line. It’s important to be transparent about what your company can afford so you end up with a suitable policy. If you overspend on group insurance, chances are you’ll cut costs elsewhere and cause employee dissatisfaction.

The Industry You’re In and the Nature of Your Employees’ Work

Once you’ve finalized a budget, tell the insurance agent whether the industry you’re in requires physical work, mental work, or a mix of both. This will help them advise you of plans that suit the nature of your employees’ work. For instance, if you’re a restaurant, your chefs are more likely to benefit from group insurance that provides ample physical health coverage in case they get injured in the kitchen.

Common Workplace Health Issues Your Company Faces

Do your workers take frequent sick leaves? If so, what are some of the reasons why? It’s vital to relay this information to the insurance agent so they can suggest plans accordingly. For example, if your employees cite mental health issues as the reason for repeated absences, the insurance agent will help you select a plan that provides comprehensive mental health coverage.

The Number Of Employees On Your Payroll With Dependents

No matter how healthy an employee is, chances are they’ll take time off if their dependents aren’t feeling well. Fortunately, many group insurance policies offer coverage for employees and their dependents. Therefore, it’s worth telling the insurance agent about your employees’ dependents with their permission.

Whether Your Employees Travel For Work Often

Did you know HMO medical insurance plans allow members to obtain medical services solely in the area where they live and/or work? In comparison, PPO plans allow members to obtain medical services in any medical facility under the provider’s preferred network. Therefore, if your employees frequently travel for work, tell the insurance agent so they can help you select plans that provide coverage in the areas your employees travel to.

Get Your Employees’ Thoughts on Group Insurance

People sitting at a table in an office having a discussion

Once you’ve finalized employer group insurance options with the help of a reputable insurance agency, it’s time to get your employees’ thoughts. A great place to start is by finding out whether your employees already have health insurance. If that’s the case, we recommend asking them what benefits their plans provide and how much their premiums are. Comparing this information with the benefits provided by the various group insurance plans you’re considering will help you find a plan your staff will appreciate. If you get stuck, ask an insurance agent for help.

After you’ve discussed your employees’ existing health insurance plans, proceed to discuss the group insurance plan you’re thinking of enrolling in. Ask them—what are your thoughts on group insurance? Would you consider switching to a company-provided medical insurance plan if it saves you money? Would group insurance incentivize you to stay at the company for an extended period? The answers to these questions will help you to gauge how employer group insurance will be received at your business.

It’s also worth being mindful about the way you ask your staff for feedback regarding the group insurance plan you’re thinking of getting. Research shows that most employees find group meetings unproductive, while one-on-one meetings have been found to yield better employee engagement.These aren’t hard and fast rules—every employee is different after all—but it’s a useful starting point to guide your interactions.

Lower Employee Resistance by Communicating How Group Insurance Will Benefit Them

A Lego man sitting at a toy desk grimacing

Productive employees produce higher quality work, get less done in more time, and exhibit greater innovativeness. But how does group insurance factor into all of this? The answer is simple—healthier employees are more productive. If you relay this information to your staff and explain how it’ll make them healthier and better able to get work done promptly, chances are they’ll exhibit less resistance toward group insurance.

With that said, it’s important to remember that group insurance is all about giving your staff easy and affordable access to medical services. Therefore, it’s important to choose a medical insurance plan that caters to your workforce’s unique medical needs. In other words, if your staff have dependents, consider a group insurance plan with dependent coverage. If anyone suffers from a particular medical condition that requires specialist care, try to factor this into the plan you’re thinking of getting. These initiatives will make your staff feel happy and genuinely cared for—both of which are conducive to an increase in employee productivity.

Use Group Insurance to Convince Your Best Staff Members to Stay Long-term

What better way to convince your most talented employees to commit to your company long-term than by showing them you care about their well-being? Research shows that employer group insurance is one of the most powerful employee retention tools companies can use. However, it’s important to be flexible and willing to innovate your group insurance policy to meet your staff’s healthcare needs.

In simpler words, it’s worth thinking about switching group insurance providers periodically to ensure your employees get the best coverage possible. As employees enter and leave your company over time, it’s worth getting in touch with a reputable insurance agent to ensure your group insurance policy is current. We also recommend checking in with your employees—especially the ones you care most about retaining—to ask whether their health needs or those of their dependents have changed. If their needs have changed and your current group insurance policy doesn’t provide adequate coverage, consider sitting with an insurance agent to discuss alternatives.

Understand How to Minimize Your Costs Through Group Insurance

No guide on how to make the most of employer group insurance is complete without a discussion on minimizing costs!When it comes to raising a company’s profitability, cutting costs is as effective as generating revenue. Fortunately, group insurance helps companies cut costs in numerous ways.

Firstly,many health insurance premiums are tax deductible. In other words, taking out group insurance is a terrific way of maximizing your company’s profitability as it’ll lower your federal and income payroll tax bill. The extent to which your tax bills fall depends on the type of group insurance plan your company is on. We recommend considering a plan with higher out-of-pocket cost coverage because most out-of-pocket medical costs are tax deductible.

Secondly, group insurance reduces the likelihood of staff illnesses costing your company. Studies show that employees who work when they’re sick cost employers up to $250 billion annually. Therefore, your company stands to save a substantial amount of money if you consult an insurance agent and pick a group insurance policy that adequately meets your staff’s healthcare needs.

Lastly, taking out group insurance lowers a company’s training costs. If your workforce is consistently healthy and productive, chances are they’ll absorb information in fewer training sessions compared to a staff member who regularly takes sick leaves. In other words, the healthier your staff are, the fewer training sessions they’ll require to upskill—and a great way to keep them healthy is by signing up for a comprehensive employer group insurance plan.

Market Group Insurance as an Employment Benefit to Attract Talented Workers

The last thing we want to touch on today pertains to prospective employees. It’s all well and good keeping your current employees healthy and productive—but what if you want to make the most of group insurance to attract fresh talent to your company? That’s where insurance agents come in.

Consulting a reputable insurance agent will help you to pick employer group insurance plans job seekers find attractive. This is especially important if your business hires less than 50 employees because small businesses aren’t legally required to provide health insurance for employees or their dependents. In other words, if you’re a small business and you offer health insurance, there’s a strong chance you’ll stand out on the job market!

Covered California Certified Agent Helps Small Businesses Take Advantage of Group Insurance Services in California

A conference table in an office

If you’re seeking help to decide between suitable small business insurance services, we’re ready to assist you at Covered California Certified Agent.

We help businesses from an array of industries pick group insurance plans that are affordable and meet their employees’ needs. We also assist clients thinking of taking out individual and dental insurance.Our dedication to providing comprehensive insurance advice has earned us a fantastic reputation, and we look forward to helping your company make the most of employer group insurance services.

Book an appointment with one of our expert insurance agents in California by dialing 800-771-7653 now.