Turning an idea into a successful company is a very difficult thing to do. From developing a product to testing the market, to building a team and navigating the recently chilled investor market – all are unique and vital skills. You know what often isn’t a high priority? Employee benefits. We wanted to highlight some things all business owners should know about employee benefits and brokers that might have you rethinking your strategy.
1. It’s no secret that people love comprehensive benefit packages.
Benefits have expanded tremendously over the past decade to include things such as ID theft, student loan assistance programs, and pet insurance. Even adding voluntary benefits with zero company contributions is viewed as a plus to your employees’ total compensation package. See what some of the largest tech companies are providing here: https://www.techrepublic.com/article/12-tech-companies-with-impressive-benefits/
2. People hate giving up benefits more than anything.
As you work with your broker to build a strategy for your benefit program over the next three to five years, make sure you have some flexibility going forward. The last thing you ever want to do to your employees is deplete their benefits package because your first offering was not sustainable.
3. Can’t afford to pay the same as big tech?
Increasing the employer contribution on spouse’s/children’s coverage will give you a fighting chance. Most tech companies cover 100% of the employee’s costs, so anything additional for their family will start to give you an edge. This is one of the first looks a prospective employee has into a company’s culture. The greater the contribution, the more people feel like the company truly cares about their employees.
4. Benefits are complicated for employers.
Benefits programs are difficult to understand – compliance on reporting, a constantly moving target with legislation that affects benefits and employees, and how do you know if you actually deserve your 20% renewal increase? Partner with a broker who understands your industry and is being strategic with you throughout the year, not just waiting until you get your renewal rates. Claims data might not be available depending on the size of your company, but your broker should be able to project out trends to give you a starting point.
5. Benefits are equally complicated for employees.
How many of your employees truly understand their total benefit package and how to maximize it? Do they understand the difference between a health savings account (HSA) and a flexible spending account (FSA)? What about the advantages of a high deductible health plan (HDHP)? Clear communication around open enrollment can significantly impact the plans employees choose and set them up for success. Ensure that you provide them with enough to inform them properly but not too much to overwhelm them.
6. Have a clear strategy that matches the projection of the company.
Do you anticipate extreme growth after a funding round? Plan for that. Need to extend your runway and cut costs? Plan for that. There are plenty of options to set your team up for future success, no matter the circumstances, but remember to position yourself to add to your benefits, compared to taking away. You do not want to lessen benefits and increase employee costs unless you have no other option.
7. Understand where your employees live and their access to care.
A considerable component of benefits is having an equitable program – make sure your broker is providing reports so you can understand the dynamics of your employees and ensure they are taken care of. With the mass movement towards remote working, more and more employees are moving further away from metropolises. Take some time to understand their access to quality care and how you can protect them.
8. Survey your employees.
Guess who knows what they want the best? People themselves. Trust and empower your employees to have a say in their benefits. It will create more plan ownership and increase their appreciation for the benefit package.
9. High deductible health plans (HDHP) and health maintenance organizations (HMO) are not bad words.
These are both strategic decisions/plans that can often yield substantial cost savings for your employees and the company. Understand your employees and what they want. Plus, don’t forget that you can offer multiple plans to ensure everyone has a plan that works for their needs!
10. Brokers are extensions of your HR team.
Don’t have the resources to dedicate a full-time employee to keep up with compliance? Don’t worry, we do. Can you only afford a junior HR employee? We’ve got the experience to help them! A great broker will be attentive to your needs and strategically guide your organization through the ever-changing benefits landscape.
If you have additional questions or would like to learn more about the impact that employee benefits can have on a company, reach out to Parker, Smith & Feek Account Executive Andrew Rose at ATRose@psfinc.com.
Parker, Smith & Feek is an independent, associate-owned brokerage firm providing commercial insurance, risk management, surety, benefits, and personal insurance solutions. Founded in 1937, Parker, Smith & Feek is an innovative industry leader and in conjunction with our IMA network of companies and its 1,800 associates. We manage over $8 billion in premium and rank in the top 25 insurance brokerage firms in the United States. PS&F’s employees are dedicated to serving clients with a customized brokerage experience and making a positive impact in their communities.
