Employee Benefits: What is an Employee Benefits Broker?
Ask any employer. Employee benefits are critical for attracting and retaining the best people. Employees get it, too: 56% say benefits are “very” or “moderately” important, and an equal percentage would take extra benefits over extra salary.
Benefits aren’t easy, though. That’s why employers count on an employee benefits broker to develop the best employee benefits package using the right vendors for the right prices That’s not all; we’ve got some more helpful information to help you select the employee benefits broker best suited for your organization. Just keep reading.
What is an employee benefits broker?
An Employee Benefits Broker is a licensed insurance professional who specializes in employee benefits brokerage services. The broker knows what benefits programs are available, which vendors provide them, and how benefits are priced. An experienced benefits broker will take the time to understand your organization and develop a customized employee benefits plan to meet your workforce’s needs.
What should an organization expect from an employee benefits broker?
Expectations for an employee benefits broker go beyond providing a menu of benefits products. The best employee benefits brokers also provide valuable consultative capabilities that save their clients a lot of trouble. One survey found employers’ top priority is compliance; 98% of respondents wanted brokers to answer compliance questions. 78% requested compliance resources from their brokers. The survey also found respondents were highly interested in online policy access, HR tools, and personalized employee benefits pamphlets and informational materials. In recent years, there has been a growing demand for counsel on human capital issues. The trend is clear: employers want more benefits expertise from their brokers.
Questions to Ask When Choosing Your Employee Benefits Broker
Evaluating employee benefits brokers is no small task. Your benefits broker will be responsible for helping you choose insurance policies and other benefits that directly affect your workforce. The health of your organization is dependent on taking the time to ask detailed questions and request any information you need to be confident with your choices. Here are a few important questions to guide you in the process:
- What is the scope of brokerage services? This question will help you learn all the benefits included in the package. Basic health care is just that — basic. Are there voluntary benefits like accident insurance and long-term disability? Do they go beyond insurance lines? Your employees may appreciate access to homeowner’s, renter’s, or auto insurance through their employer.
- Do you provide compliance consulting? There are federal and state laws and regulations associated with the Affordable Care Act (ACA). Violations of these laws can be met with penalties in the form of fines. Your prospective broker needs to be familiar with these regulations and their penalties, preferably having a team of compliance experts.
- What additional resources, capabilities, and expertise do you provide? An employee benefits broker shouldn’t be one person — it’s a team of experts. Compliance experts, underwriters, risk analysts, a medical director to review pre-authorizations and claims, and more. As employers’ expectations expanded, its better if a benefits broker’s expertise extends outside insurance into arenas like human capital management.
- Do you provide open enrollment assistance? This is a must-have. Open enrollment communication programs are critical to employee engagement. Exceptional benefit communications, guidance for HR teams, and benefits products that directly address employees’ needs are all things to look for when wondering how your broker may be able to support your open enrollment needs.
- What are your fees? This question may seem like a no-brainer to ask, but there’s more to it. Fee structures can vary between brokers. Employee benefits brokers may charge a flat fee based on the number of employees covered monthly or be paid commissions by insurers. You’ll have to choose which approach works best for your organization.