by Kevin Ryan, Senior Vice President
Throughout last year, you probably worked with a broker to renew your employee benefits plans. Your broker considered what changed in the marketplace, researched new and growing trends, and decided on a plan that they thought would benefit both your employees and your organization.
Looking back, how did that process go for you? Did you understand the price impact that your renewal would have? Did your employees react the way you expected, or were they disappointed in the offerings? Did you feel you had access to ideas, plans, and options that offered cutting edge innovations?
Now that the employee benefits renewal process for 2018 is over for most of you, it’s time to reflect on how it went, and consider what you might like to change for the coming year. After all, who doesn’t want the best possible renewal experience? As you assess last year’s renewal process, here are 5 questions to ask yourself.
1. Was my broker an advocate for my best interests?
The best benefits brokers act with your best interests in mind. You want an advocate who will not only package up your company profile (growth, revenue potential, long-term strategy, etc.) in a way that is attractive to insurance carriers and benefits vendors) but one who will seek out the best rates and options for you and go to bat for you when necessary.
Unfortunately, many employee benefit brokers get complacent with the status quo. Perhaps they make the same recommendations over and over again, year after year, and aren’t innately wired to proactively seek out new opportunities that save you time and money (or they only do so when asked by you). When is the last time your employee benefits broker sent you real-time, regional or national reports benchmarking your benefits plan design compared to your competition or took a critical look at whether or not your HCM system needs an upgrade?
Partnerships with complacent, reactive employee benefit advisors who only meet with you twice a year can lead to significant setbacks over compliance failures such as ACA requirements as well as the possibility of missing out on opportunities to attract better talent. The best benefits specialists are creative, innovative and often experimental with how they can save you time and money. It may be time to look for another broker for the coming year.
2. Were there any surprises when it came to timing or rates?
When it comes to the employee benefit plan design process, there shouldn’t be any surprises. You don’t want to be shocked by rates, price, or timing. When you think back over the process, did your broker prepare you every step of the way for what was in store?
Rate increases and mandatory employee benefit plan changes are the most common culprits that evoke shock and anxiety for most of our clients. Your broker should be armed with reliable, creditable, predictive analytics tools that give you a detailed, accurate estimate of what you’ll spend this next year and provide further education on how to keep these costs down year to year.
If you’re a small group under 100 employees, you might be surprised by mandatory plan changes such as RX copay increases or modified deductibles. This type of surprise is unavoidable for some small groups, but a good broker can help prepare you for these changes and make appropriate plan adjustments to offset any additional costs incurred.
3. Was I kept up to speed on the latest trends and innovations?
Your broker should help you navigate innovations, trends, policies and guidelines that emerge in talent acquisition, compliance, benefit plan design and HR technology, in addition to any insights you’ll gain on your own. For example, last year we saw many companies curious about:
wellness platform strategies to drive behavior. Organizations were increasingly interested in wellness platforms that could modify employee behavior, driving insurance spend down;
funding alternatives. Companies wanted to offer different ways to fund their plans. They explored consumer-driven concepts such as fully-insured vs. self-insured, and HSAs vs. HRAs;
voluntary benefits. 2017 saw many conversations surrounding voluntary benefits as leverage in the war for top talent. Some of the more popular offerings included student loan repayment, identity theft protection, and pet insurance.
If your broker kept you in the loop on, helped you get ahead with, and even implement some of these innovations, then you’ve likely found a good fit.
4. How customized was my experience?
We’re all in this together and have our eyes on one prize – a benefits solution that contributes positively to your business’ bottom line and to your employees’ well-being. The moment you feel like “just a number” is the moment to reassess your broker partnership. When you look back at last year’s renewal, how did they customize your experience?
Many brokerage firms fall victim to the ongoing cycle of annual renewals, often operating within the confined walls of what they know, rarely stepping outside the box to explore alternative options that might suit your needs better, especially as your business scales or is considering an IPO. This is not an area where your broker should be passive.
Your broker should act as an extension of your HR, People Strategy and/or finance teams and be privy to the same institutional knowledge that you have as an employee engagement leader. For example, they should ask about any leadership changes happening within your organization, always know how many open job positions you’re hiring for, HCM software you’re interested in adopting and other “inside scoop” information that will impact their ability to advocate for you. The moment your broker acts or feels like an outsider to your organization, the partnership loses its potential.
By positioning themselves as a part of your team, your advisor can look objectively at your benefit plan design and make informed recommendations for vendors that align with your goals and carriers that align with your growing needs.
5. How was my broker’s ongoing management throughout the year leading up to renewal?
We all know how much preparation, time, research and discussion goes into the renewal process. You should have felt fully comfortable and prepared with market trends, stats and figures that informed your renewal strategy, given to you well in advance of your deadline and your broker plays a huge role in that level of preparedness.
So, when you reflect back, consider whether you received ongoing support and management:
Were you kept up to speed throughout the marketing process?
Did he bring new ideas to the table that you hadn’t yet thought of?
Were you asked thoughtful questions that aligned with your business’ goals for next year?
How often did you meet?
Did he follow up with supporting data that validated your decisions?
The best renewals are the ones planned throughout the year, informed by frequent brainstorming conversations, and foster open communication about what you need to plan for and what changes need to happen to support a growing organization. Armed with this information, your broker can then formulate a renewal game plan, making sure every step of the process is planned well in advance and deftly managed.
When you look back at last year’s renewal process, you should’ve had an understanding of the price impact to your organization, have compared the best plan designs against each other, and you should’ve felt informed with and educated on the latest trends and cost-saving, cutting-edge solutions. If last year’s renewal process didn’t go smoothly, or you feel that there were some missed opportunities, it’s a good idea to ask yourself these questions and maybe even consider new broker opportunities.
Your broker partnership will not always be harmonious, easy, or fun, not just leading up to renewal but throughout the year. But would you want it to be? The job of a benefits advisor, like any good colleague, is to push you to be creative, challenge you to think differently and brainstorm with you in a collaborative and open environment to generate new ideas that make sense from both a financial and “employee benefited” perspective. Any other type of relationship, in our opinion, doesn’t serve you.