As time goes by, your needs for company benefits will change and your original provider might no longer be the best fit. Fortunately, changing employee benefits providers is a fairly straightforward process. Here’s what you need to consider when you switch your benefits.
When a Change Might Make Sense
Changing employee benefits providers can make sense if your existing plan gets too expensive. You only have so much in your budget so you want the best return for your benefits. If your workforce demographics change, it also could make sense to switch. The provider that did a solid job when you had 15 employees might not offer enough support when you have 50.
Your employees might want new benefits that are not available with your current provider. Finally, your employees may no longer be satisfied with the old provider. After all, your main goal for offering benefits is to make them happy so if your current benefit provider isn’t doing the job, it’s time to switch.
Comparing Other Providers
When you research different benefit providers, make sure they offer the same benefits so you can continue offering your employees the same package after the change. If you are switching providers for health/dental insurance, ask whether the new company offers an appropriate network for your area so employees can keep seeing the same doctors/dentists.
You should also check how long the companies have been in business. Make sure that they are financially stable by checking their credit rating, and make sure they have a good reputation. Finally, ask the provider for a history of their rate increases over the past few years. This way you can get an idea how much your prices could change in the future compared to current rates.
For cost, remember to consider the entire picture. While premiums should be an important factor, they are not the only factor. Even if a benefit provider charges a lower premium, it might end up more expensive if their benefits come with higher out-of-pocket expenses.
Communicating with Employees
You should be regularly surveying your employees to see how satisfied they are with your current benefit provider. This way you can see whether they want a change and if they do, what they want you to adjust.
Once you decide to switch employee benefit providers, you should let your employees know as soon as possible. They will be understandably concerned when important benefits like health insurance and retirement change and you need to reassure them that they will keep the same quality package.
Handling the Transfer
When you sign up with a new benefits provider, they should help get you ready for your first open enrollment with the new plan. In the leadup to enrollment, you should have a meeting with your employees to discuss how their benefits will change, what will be better and what fees could increase.
It’s important that your employees have the information to properly evaluate the new plan. Ask your new provider for materials like pamphlets, newsletters, their company website and other pieces to help with onboarding. They should also send representatives during your open enrollment to answer employee questions.
For most benefits, the transfer should be simple since you are just replacing a one-year contract with another, like switching health insurance plans. If you are switching your retirement plan, it’s a little more complicated because you need to safely transfer the plan assets. The benefit provider should walk you through the process. Start the transfer early so you have plenty of time and avoid a delay where your employees lose access to benefits.
Changing employee benefits providers works best when you start your research early and give your employees plenty of heads-up throughout the process. By considering this advice, you can have a smooth transition to your new plan.