Archive for October, 2009
So you are shopping for a small business health insurance provider. For small businesses, it is specifically important to get a size-specific insurance coverage plan. As far as size-based health insurance coverage is concerned, the industry differentiates between individual/family plans, small business group insurance and large group health insurance.
Generally, a business qualifies as a small business for group insurance purposes, if it has 2-50 employees including owners and officers. The particular circumstances of this group make this distinction necessary. In the state of California alone, the distinction automatically entitles the group insured to three legal protections – guaranteed issue, guaranteed renewal and rates increase protection. Clearly, the size of your company defines the health insurance options available to you, as well as the rates you get given. With that in mind, you are in a better position to evaluate rate quotes and decide which group health insurance plan matches your group’s needs.
Group Health Insurance Quotes
Employer pays part or all of the cost of premiums for a group health insurance plan, while the final beneficiaries are the employees and their families. The best provider would be one that gives an employer a fixed budget for employee health benefit while providing each employee in the group complete flexibility to choose health coverage that matches their specific needs.
A provider may or may not look at the current health profile of your group in quoting rates. Often, they give you a rating based on its risk adjustment factor (RAF) calculation. The RAF is directly affected by the size of the group and it directly affects your premium rates. Basically, the larger groups get better RAF ratings which translate to discounts on premiums. In many cases, size is the single most relevant factor in group health insurance quotes.
Why Offer Group Health Insurance
Although in some states it is a legal requirement, group health insurance coverage for small business is often an employer-instigated benefit. From a financial standpoint, it is an expense item. But from a long-term business standpoint, this expense forms and intangible investment toward your human resources. Why does it make sense to offer group health insurance coverage to your people?
For one, it makes your business more competitive. After salary expectations, small business health insurance coverage is the top benefits employees look for in a prospective employer. If you offer a good package, you’re a step ahead toward attracting qualified, talented and motivated people to work for you and to stay.
For another, the employer’s share in the group health insurance premium is tax deductible, 100% in some states like California. While building a good employer-employee relationship with your staff, you’re also saving your business some money. That sounds like a win-win situation, doesn’t it?
Offering your employees group health insurance coverage not only boosts your business but improves its community image as well. Besides being an effective way to lure talent and ensure longevity, health benefits to employees give an otherwise inhuman business humane qualities of caring for other’s welfare. It inspires loyalty and hard work.
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