Business & Group Insurance

Employee Group Benefits Packages

Many employers use their employee benefits packages to attract and retain valuable employees to keep their business thriving. At the very least, employee benefits can consist of health, dental, disability and life insurance.

We can assist you to develop a combination of carriers and products that meet your needs and expectations.  We will work with you to develop strategies to ensure you are in line with your competition.

Health Insurance

Offering health insurance is a crucial component of any Employee Group Benefits Package. Not only does it provide financial protection against unexpected medical costs, but it also promotes a healthier and more productive workforce. According to a recent study, 88% of employees consider health insurance a critical factor when choosing a job[^1]. By providing comprehensive health coverage, you can attract and retain talented employees who value their well-being.

Types of Health Insurance Plans

When selecting a health insurance plan for your employees, you have several options to consider:

• Preferred Provider Organization (PPO): PPO plans offer flexibility by allowing employees to choose their healthcare providers. They typically have a network of preferred providers, but employees can still receive coverage for out-of-network providers, albeit at a higher cost.
• Health Maintenance Organization (HMO): HMO plans emphasize a primary care physician who coordinates all healthcare services. While they offer lower costs and comprehensive coverage within the network, they generally restrict coverage for out-of-network providers and require referrals for specialist visits.
• Point of Service (POS): POS plans combine aspects of both PPO and HMO plans. Employees can choose between in-network and out-of-network providers. However, they will need a primary care physician and referrals for specialist visits to receive the highest level of coverage.
• High-Deductible Health Plan (HDHP) with Health Savings Account (HSA): HDHPs feature higher deductibles but come with lower premiums. Employees can pair an HDHP with an HSA, which allows them to save pre-tax dollars for qualified medical expenses. This option may be suitable for employees who prefer lower monthly costs and are comfortable with higher out-of-pocket expenses.

Considering the unique needs of your employees and discussing with them about their preferences can help you make an informed decision regarding the type of health insurance plan to include in your benefits package.

Dental and Vision Insurance

In addition to health insurance, providing dental and vision insurance as part of your Employee Group Benefits Package can further enhance the overall coverage. Dental insurance covers preventive care, basic procedures like fillings, and major procedures like root canals. Vision insurance typically covers regular eye exams, prescription eyewear, and discounts on corrective procedures. Including dental and vision insurance can help address the specific health needs of your employees, ensuring their overall well-being.

Disability Insurance

Disability insurance is often overlooked but plays a crucial role in protecting employees’ income if they become unable to work due to an illness or injury. It provides a percentage of their salary as a replacement income during the disability period. Offering short-term and long-term disability insurance options within your Employee Group Benefits Package assures your employees that their financial needs will be taken care of in case of unexpected circumstances.

Life Insurance

Life insurance is another essential component of an Employee Group Benefits Package. It provides financial protection to employees’ families in the event of their death. Offering a basic life insurance policy as part of the package can provide peace of mind to your employees, knowing that their loved ones will be supported financially in difficult times.

Retirement Plans

Helping your employees plan for retirement is an excellent way to show your commitment to their long-term financial security. Offering retirement plans, such as a 401(k) or a simplified employee pension (SEP) plan, allows employees to save for their future while also providing potential tax benefits. By including a retirement plan in your Employee Group Benefits Package, you can attract and retain top talent who prioritize their financial well-being.

Additional Employee Benefits

While health insurance, dental and vision insurance, disability insurance, life insurance, and retirement plans form the core of an Employee Group Benefits Package, you can also consider additional benefits based on your employees’ needs and preferences. These may include:

• Flexible Spending Accounts (FSAs): FSAs allow employees to contribute a portion of their pre-tax income to pay for qualified healthcare expenses, such as deductibles, copayments, and prescription medications.
• Employee Assistance Programs (EAPs): EAPs offer confidential counseling services and resources to help employees cope with personal and work-related challenges, promoting their mental health and overall well-being.
• Wellness Programs: Implementing wellness programs, such as gym membership reimbursements or incentives for healthy behaviors, can encourage employees to lead a healthier lifestyle, reducing healthcare costs in the long run.
• Educational Assistance: Providing educational assistance, such as tuition reimbursement or scholarship opportunities, can support your employees’ professional development and foster loyalty to your organization.

Remember, offering a diverse range of benefits within your Employee Group Benefits Package allows you to cater to the unique needs and preferences of your employees, creating a happier and more engaged workforce.

Consult with an Insurance Broker

Selecting the right insurance options for your Employee and Group Benefits Package can be overwhelming. That’s where an insurance broker like myself comes in. As an experienced professional, I can help you navigate the complexities, understand the specific needs of your workforce, and recommend the most suitable insurance options for your business. By leveraging my knowledge and expertise, you can create a comprehensive benefits package that supports the well-being and financial security of your employees.

If you have any questions or would like to discuss your Employee Group Benefits Package further, please don’t hesitate to reach out. I’m here to guide you every step of the way.

Choosing Health Insurance for Your Business

As a business owner, it is in your best interest to offer your employees a comprehensive benefits package. Health insurance is a good place to start. Did you know that offering health insurance to your employees is not just about their well-being, but also plays a vital role in attracting and retaining top talent? Studies have shown that 88% of employees consider health insurance a critical factor when choosing a job. By providing Group Health Insurance, you demonstrate your commitment to your employees’ health, fostering job satisfaction and productivity. 

Offering the “right” health insurance plan is one of the most important decisions you can make as a business owner. Keeping employees happy and healthy will benefit you in the long run. But making sense of the complex health care system has become increasingly difficult for employers. We are here to help you understand and then, untangle, your group health insurance options.

What is Group Insurance?

Simply put, group health insurance is a health insurance plan you extend to your business’s staff and, perhaps, their dependents. With a group health insurance program, you pay either part or all of the cost of the monthly premiums for your employees, from which you typically gain certain tax benefits.

Types of Group Health Insurance Plans:

• Fully-Insured Plans: Traditional route where you purchase coverage from an insurance carrier by paying a fixed premium.
• Self-Funded Plans: Offer more flexibility and control as you assume the financial risk for providing healthcare to your employees.

Choosing the right plan involves considering factors such as the size of your business, your employees’ needs, and your budget. It’s essential to work with a health insurance broker who can guide you through this decision-making process.

Employee perspectives are crucial. Conduct surveys or have open conversations to understand their healthcare needs better. Involving them in the decision-making process helps choose a plan that aligns with their expectations.

Resources for Informed Decision-Making:

• Department of Labor’s Health Benefits Advisor
• Small Business Health Options Program (SHOP)

Ultimately, selecting the right Group Health Insurance plan is significant. It requires careful evaluation to meet both your employees’ needs and your financial capabilities. I’m here to support you in finding the optimal solution for your business.

There is no right or wrong answer when it comes to health insurance planning for your business because there are many variables to consider. I can help you determine the plan that is right for you and then help you develop a strategy that is best for both your company and employees.

If you have any questions or need further assistance, please don’t hesitate to reach out. I’m here to help every step of the way.

Health Reimbursement Arrangements

A health reimbursement arrangement (HRA), also commonly (and mistakenly) called a health reimbursement account, is an employer funded health benefit. Confirmed in 2002, the IRS approved the use of HRAs to reimburse employees for their qualified medical expenses and health insurance premiums.

HRAs are not health insurance. Rather, they provide an allowance of dollars on a tax-free basis for employees to purchase health care services. The arrangement is especially great for smaller businesses who may be unable to afford group health insurance or extensive coverage.

Benefits for the Employee

Employees benefit from HRAs as out-of-pocket expenses such as deductibles, co-pays, and coinsurance can be paid for using HRA dollars provided by their employer. If the same dollars are instead used to increase an employee’s pay, taxes would eat away 20% to 40% of their purchasing power.

Benefits for the Employer

Employers benefit by attracting and retaining talent. Financially, HRA contributions may be deducted as a business expense, reducing an employer’s FICA and FUTA taxes. HRAs are also highly flexible, allowing employers to mold the plan to meet their specific organization’s benefits needs. Any unused dollars may be retained by the employer.

How HRAs Work

Health reimbursement arrangements are relatively simple. There can be a few variations between plans, but in general, each follows the same configuration:

1. The employer establishes an allowance amount for their employees.
2. Employees purchase health products and services.
3. Employees submit proof of their purchases.
4. The employer reviews the purchase receipts.
5. The employer reimburses employees for the purchases made.

HRAs do not need to be pre-funded. Instead, employers can reimburse employees as they submit the proper documentation. So long as the expenses are qualified (see the whole list here), both parties will benefit.

There are specific steps required before you take advantage of an HRA. Contact our office to review your options and select a plan that bolster your benefits and your bottom line.

Protect Your Business with Key Person Insurance

Keyperson insurance is a critical component of any organization because it can help the company survive the blow of losing an integral member of your business.

Replacing a key person takes time, money and could cost your business valuable clients during the transition. Key person life insurance offers a death benefit that can help cover financial losses that occur at the death of a key person. This helps assure continuity of the business for employees, customers and creditors.

Taking out a key person policy on your top employees also affirms their value to your business, strengthening the relationship.

Other features of key person insurance

• The death benefit can be used to recruit and develop a replacement for the previous key employee
• Coverage is a business asset that enhances your company’s creditworthiness for commercial borrowing
• The policy’s cash value may be available to your business through a withdrawal or loan if needed
• The business pays the premiums, and they are non-deductible

How much life insurance is needed on a key employee?

This is a difficult question and budget will, no doubt, be a factor. Most life insurance companies will approve up to 5-10 times the key employees’ annual salary including bonuses. Age will be factored in as well on the multiple of income allowed. The insurance carrier will want to know the nature of the business, when the company was started, net worth of the company, if the key person is an owner of the business and if all key people will be insured. Insurance carriers will want to see that all key people, or owners of the company will be insured. It’s a red flag to them if any key persons or owners aren’t being insured, unless they are uninsurable.

The Importance of a Buy-Sell Agreement

As a partner or co-owner (private shareholder) of a business, you’ve spent years building a valuable financial interest in your company. If you thought about setting up a buy-sell agreement to ensure your surviving family a smooth sale of your business interest than consider life insurance.

How to set up different types of buy-sell agreements

In an entity purchased buy-sell agreement, the business itself buys separate life insurance policies on the lives of each of the co-owners. The business usually pays the annual premiums and is the owner and beneficiary of the policies.

In a cross purchase buy-sell agreement, each co-owner buys a life insurance policy on each of the other co-owners. Each co-owner usually pays the annual premiums on the policies they own and are the beneficiaries of the policies. If your company has a large number of co-owners, multiple policies must be purchased by each co-owner.

A wait and see (or hybrid) buy-sell agreement allows you to combine features from both the entity purchase and cross purchase models. The business can buy policies on each co-owner, the individual co-owners can buy policies on each other, or a mixture of both methods can be used.

The buy-sell agreement should be fully funded

The amount of insurance coverage on your life should equal the value of your ownership interest. Then, when you die, there will be enough cash from the policy proceeds to pay your family or estate in full for your share of the business. But, if all that is affordable is insurance coverage for a portion of your interest, you might want to go ahead and fund that amount. Later, the company may be able to increase the amount of insurance or use additional funding methods. In the meantime, the agreement should specify how your family or estate will be paid.

The value of the business could change

What if the insurance proceeds turn out to be less than the value of your business interest, due to growth in the business? Your surviving family members might end up getting less than full value for your business interest. Your buy-sell agreement should specify how the valuation difference will be handled.

Conversely, the insurance proceeds might be greater than the value of your business interest when you die. Your buy-sell agreement should address this potential situation upfront and specify whether the excess funds will belong to the business, the surviving co-owners, or your family or estate.

Keeping track of your buy-sell agreement

Each year, the premiums on the policies must be paid, or the insurance will lapse. So monitor premium payments carefully. Your buy-sell agreement should include a feature requiring ongoing proof of payment. Also, review the amount of insurance regularly. The insurance coverage may have to be increased periodically to reflect increases in the value of the business. If additional insurance is not possible, another funding method should be established.