Over the past ten years, I have known Michael Kachidurian, President of Chatham Consulting Group, to be a dedicated expert in employee benefits planning who consistently provides sound insurance solutions to his client base. In keeping with Spa Trend’s philosophy, to exceed client expectations, Chatham utilizes creative and innovative strategies in developing tailor-made employee benefits packages for small to medium size companies. Chatham is a leading national provider of employee benefits and brings 20 years of industry experience and know-how in this niche market.
I asked Michael to share information regarding group benefits that is important to all small business owners. He developed a format that is educational and straightforward in its approach:
10 Myths About Group Insurance Policies
(That your broker doesn’t want you to know or ask about)
Benefits plans represent the 2nd or 3rd highest expense in running your business. Keeping those costs under control is the job of your group insurance broker. Yet many companies don’t really know if they are receiving the best service and support from their broker. They continue to use the same person for years because there is a perceived idea that “changing my insurance broker is a hassle”. The truth is, if your broker is not paying attention to your business, it is probably costing your company a substantial amount of money. Your broker should be a proactive partner that is communicating with you about the best options currently available for your company’s insurance needs. These 10 myths have kept customers tied to the same broker for years without any benefit to the client.
Myth #1 – You have to wait until renewal time to change brokers.
Truth #1 – If you are not satisfied with your broker, you have the right to replace them at
any time. Most carriers will accept a change of broker letter effective the 1st of the
month following the receipt of the letter.
Myth #2 – If you change brokers, you have to change plans or you need to complete all new
paperwork.
Truth #2 – The only paperwork necessary to change brokers is a formal broker of record letter
to the current carrier (we can supply one to you). There are no disruptions in service.
Plans don’t change and benefits adjustments are made at your convenience.
Myth #3 – Your company has no choice but to accept the high double digit increase.
Truth #3 – There are more choices than ever today for employers. Companies can explore plan
designs, funding methods, contribution schedules and voluntary options.
Myth #4 – You can only receive competitive rates if you are a large company.
Truth #4 – There is an advantage to having more employees because it enables the carriers to
spread the risk on a larger group. However, the rate for all medical plans over 50
employees and ancillary plans over 10 employees can be negotiated based on the
demographics of the group. Even groups under 50 employees have options if you
know where to look for them.
Myth #5 – You can only obtain the best rates if you have a large broker negotiate on your behalf.
Truth #5 – All brokers have access to the same rates and have to be quoted the same rate on a
particular plan design. Only a change of benefits can effect a change in the rate. The
question really is – Does your broker look at all the available alternatives and provide
you with a range of options to select from?
Myth #6 – You have to wait until renewal to change carriers.
Truth #6 – Many carriers will not allow plan design changes mid year. However that’s
negotiable based on your size and the prospect of them losing the case. In addition,
for fully insured cases, you can change carriers with 30 days written notice.
Myth #7 – Small companies have no choice of plan designs or benefits options.
Truth #7 – Carriers today are giving smaller companies many of the same choices that large
market companies receive. Rx card options, gated, un-gated plans, co-payments,
co-insurance and a host of ancillary line options are now available.
Myth #8 – Only very large companies can use alternative funding methods.
Truth #8 – ASO and minimum premium plans are available to companies as small as 50
employees. In addition the new HDHP (High Deductible Health Plans) offer an option
worth exploring to cut costs on a fully insured basis.
Myth #9 – You should only hear from your broker at renewal time or if there is a problem.
Truth #9 – Your broker is responsible for a very large expense item. Your broker should be in
regular contact with you to offer service support as well as his advice on new plan options that carriers make available.
Myth #10 – You need multiple brokers for different types of insurance products.
Truth #10 – Your group insurance broker should be your advisor and consultant on your other
insurance issues. Even if they do not actually write the policy, since they know your
business needs so well, they are in a great position to find you the best person for
your needs.
Website:
Email: anthonycarroccio@aol.com
