From our team to yours, we want to wish our clients a very happy and healthy 2016!
The world of employee benefits is always evolving, and this year is no exception. Advancements in technology are making benefits-related processes easier, insurance providers are releasing new offerings that better suit employee needs, and new partnerships are forming to enhance services.
As you reflect on last year, and plan ahead for another, here are five trends that could influence your choice in an employee benefits advisor.
1. Buying into Payroll Technology through Benefits – There is a common link between payroll and employee benefits, and human resource (HR) departments or business owners are looking for solutions to efficiently manage it all. In turn, more payroll and HR software companies are entering the benefits industry, some offering their HR and payroll management systems for free once customer choose them as their employee benefits brokers.
While this benefits business model has seen tremendous success in the United States, it’s still uncertain whether this will have the same impact in Canada. Canadian companies are more familiar with employee benefits, government resources are readily available to businesses, and premiums are generally much lower in Canada. While the verdict is still out on its fit in the Canadian market, it’s an interesting trend that could affect a client’s broker selection.
2. Merging of Benefits-Related Services – Much like the merging of payroll technology and employee benefits brokering, more business partnerships are being formed which cater to those that manage benefits and other related functions within an organization. For example, more benefits advisors are expanding their service offerings by partnering with human resource specialists, legal aids, and even financial planners.
The reasoning is simple – they have the same clients, and aim to offer these clients more complementary services to help them streamline their operations. Some insurance providers are even enhancing their offerings by partnering with HR solution providers in hopes of winning more business.
3. Offering the Flexible Benefits Plan – Gone are the days when one employee benefits plan fits all. Varying employee demographics and needs are prompting business owners to look at more customizable options such as a flexible employee benefits plan. The flex plan not only provides greater freedom of choice to employees, but it also helps companies stay on budget and enhance rate stability on renewals.
While these flexible plans have been available to larger organizations for many years, some insurance providers are offering flexible plans to companies as small as five employees through select advisors. If greater customization and individualization is something that interests your company, choosing a benefits consultant that understand the details and implications of a flexible benefits plan is best.
4. Negotiating Rising Renewal Rates – The popularity of employee benefits means cost plans are rising. Employees see tremendous value in health and dental plans offered by their employers, and their active usage and claims are driving costs up. These rising costs and higher renewal rates are encouraging companies to lean on more client-oriented benefits consultants, who will work on their behalf to make sure they get a fair rate.
Choosing an advisor with extensive industry knowledge, solid provider relationships and strong negotiation skills will benefit any client upon renewal. While some brokers promise the same level of commitment, others simply don’t put in the effort, leaving clients disappointed and feeling cheated. These rising premiums are forcing companies to be more selective about who is representing their business upon renewal.
5. Requesting Better Service – Negotiating renewal rates is one aspect of better service, but there is far more that is required and requested from benefits advisors today. Clients are looking for a trusted source of information, an advisor that will be there to support them, answer questions, educate staff and work with providers to get the best benefits package at the best price.
There is a move away from a traditional broker, that simply finds the deal and gets papers signed, to a hands-on benefits consultant that guides clients from plan setup and employee enrollment, to claims disputes and rate renewals and everything else in between. A benefits consultant goes above and beyond the scope of a broker, answering any queries, providing basic advice on HR-related topics, offering educational seminars, monitoring plan performance on a quarterly basis, or arranging out-of-the-box perks such as financial wellness programs. A move from benefits broker to benefits consultant is on the upswing this year. (For more information, read our article titled “5 Questions to Ask When Choosing Your Employee Benefits Consultant”.)
These are only a few market trends which will likely influence a client’s choice in an employee benefits advisor this year. Have more to add? We want to hear your thoughts here.
Whether you are with a business, association, or owner operator, we have the solution for your needs.