A well-designed group benefits plan can be critical to attracting and retaining the right talent, and to keeping employees healthy and productive at work.
But offering benefits for small business can be a challenge. While many small employers want to provide their teams some degree of coverage, obstacles stand in the way. As a result, many of the almost eight million Canadians who work at a small business are left without coverage.
According to a 2011 LIMRA study, only 72% of Canadian employers with between 50 and 99 employees offer some sort of health benefits. That number drops to 53% for employers with between 20 and 49 employees, to 34% for those with between 10 to 19 employees and to 24% for those with between five and nine employees.
What’s holding them back? Here's what small business owners across Canada have told us are some of the key employer challenges.
Diverse needs
Small employers traditionally haven’t had the same options as large companies. While their teams are small, they include people from a range of age bands, varying family situations and different health profiles. So the one-size-fits all plans typically available have made it difficult to meet those diverse needs. They don’t want to go to the effort and cost of offering a plan that their employees neither use nor appreciate.
Financial considerations
Small business owners told us that cost – and cost predictability over the long-term, in particular – is a big concern. They want to avoid making a commitment to their employees that they can’t sustain. They also wondered about what amount of cost-sharing is fair, how to broach the subject of cost-sharing with their employees and how to help their employees understand the value of their benefits program in their overall compensation.
Expertise gap
Unlike large companies with sizeable human resources departments, the person making benefits decisions at a small company is often the owner. He or she may have no background or expertise in HR, let alone an understanding of group insurance.
The business owners we met were also concerned about the day-to-day demands involved with offering a health benefits plan. How much of their busy schedule would be spent learning about the plan and looking after the details? They also wondered how much service and support they could expect to receive for things like employee communications and education.
Others simply didn’t know where to begin. They don’t know where they should go to investigate the options or who they could turn to for objective advice.
The solution
Regardless of what’s holding you back, the first step is to develop a relationship with a trusted advisor who has expertise in group benefits. The right advisor can help you understand the health needs, preferences and expectations of your workforce and develop a plan to align with those needs.
The next step is to choose a solution – there are a number of cost-effective products and services available to fit a range of objectives and budgets. The right advisor can educate the employer about the best options to fit their workforce and their bottom line. As well, the advisor can provide advice on cost-sharing arrangements, and guidance on how to communicate them with employees.
Once an appropriate solution is identified, the right advisor can explain the mechanics of the benefits plan and ensure that the employer is receiving the support and service that they need.
