Group health and life insurance plans are a popular benefit that many businesses offer to their employees. These plans provide a range of benefits, from lower costs to better access to care, and can help businesses attract and retain top talent. In this blog post, we’ll explore the benefits of group health and life insurance plans for businesses.
Benefits of Group Health Insurance Plans
Lower Costs
One of the primary advantages of group health insurance plans is that they spread the risk across a pool of insured individuals[1]. This benefits the group members by keeping premiums low, and insurers can better manage risk when they have a clearer idea of who they are covering. Insurers can exert even greater control over costs through health maintenance organizations (HMOs), in which providers contract with insurers to provide care to members[1]. Employers can also enjoy favorable tax benefits for offering group health insurance to their employees[1].
Better Access to Care
Group health insurance plans can provide better access to care for employees. These plans often have a larger network of providers, which can make it easier for employees to find a doctor or specialist when they need one[2]. In addition, group health insurance plans may cover a wider range of services than individual plans, such as mental health care, maternity care, and prescription drugs[2]. This can help employees get the care they need without having to worry about the cost.
Improved Morale and Employee Retention
Offering group health insurance plans can also improve morale and employee retention. Employees tend to be happier and more satisfied with their jobs when they are offered group insurance[2]. Some small employers indicate that their employees will accept slightly lower wages if those wages come with health insurance[2]. In addition, employees can benefit tax-wise and convenience-wise by paying premiums right from their paychecks[2]. In a small business health benefits survey, a majority of small business owners reported several positive effects of offering health insurance for their employees[2]:
– 78% said it increased loyalty and decreased turnover.
– 75% said it helped employee recruitment.
– 64% said it increased productivity.
Benefits of Group Life Insurance Plans
Financial Protection for Employees and Their Families
Group life insurance plans provide financial protection for employees and their families in the event of an unexpected death. These plans typically pay out a lump sum to the employee’s beneficiaries, which can be used to cover expenses such as funeral costs, outstanding debts, and living expenses[4]. This can provide peace of mind for employees and their families, knowing that they are protected in the event of a tragedy.
Lower Costs
Group life insurance plans can also be more affordable than individual plans. This is because the insurer is spreading the risk across a group of policyholders, which can help keep premiums low[4]. In addition, employers can often negotiate better rates with insurers than individuals can on their own[4].
Attract and Retain Top Talent
Offering group life insurance plans can also help businesses attract and retain top talent. Employees are often looking for comprehensive benefits packages that include life insurance, and offering this benefit can make a business more competitive in the job market[4]. In addition, employees who feel that their employer cares about their well-being are more likely to stay with the company long-term[4].
Conclusion
Group health and life insurance plans provide a range of benefits for businesses and their employees. These plans can help lower costs, provide better access to care, improve morale and employee retention, and provide financial protection for employees and their families. By offering these benefits, businesses can attract and retain top talent, and show their employees that they care about their well-being.
Citations:
[1] https://www.investopedia.com/terms/g/group-health-insurance-plan.asp
[2] https://healthcoverageguide.org/part-one/reasons-to-purchase-group-coverage/
[3] https://www.ehealthinsurance.com/resources/small-business/what-are-the-advantages-of-group-insurance
[4] https://www.peoplekeep.com/blog/pros-and-cons-of-group-health-insurance
[5] https://www.healthcare.gov/small-businesses/learn-more/explore-coverage/
[6] https://www.humana.com/employer/group-benefits-101/about-group-health-benefits/4-things-to-consider-when-buying-group-health-insurance