Did you ever have the “chance” to discuss group insurance plans with your brother-in-law? “My plan is generous, I have dental, glasses, etc.” He would make anyone envious!
But comparing group insurance plans is not that simple. Several factors must be taken into account as they can impact plan costs.
Employees and employers often wonder how their plan compares with others. The following aspects must be considered.
Benefits that are often neglected
In family gatherings, you will seldom hear your brother-in-law boast about his amazing disability insurance plan. Usually, people compare their medical and dental coverage. But life and disability insurance benefits are very important and can also be generous. Among key factors, the life insurance volume, the level of benefits and the duration of disability benefits can have a major impact on costs.
Premium sharing
Premiums are an aspect that is often overlooked when making comparisons. An employer can provide a very generous plan but pay only 50% of the premiums, while another will offer only a basic plan but bear 75% or even 100% of the premiums. Once the first pay or a hefty renewal is behind us, we quickly forget how much of our salary goes towards our insurance premiums!
In Quebec, 50%-50% premium sharing is quite common in small businesses and for blue collar employees. In large businesses, and for white collars and professionals, premium sharing is often more generous (e.g. 75% paid by the employer).
The coverage provided matters, but there is more…
Of course, plan costs are directly affected by the coverage offered. Dental care, eyewear and massage therapy do not come cheap! But the plan features must also be considered:
- Does your plan reimburse 100%, 80% or 70% of your claim amounts?
- Are there maximum claim limits?
- Must you pay a $50 or $100 annual deductible?
- Does your drug plan have a $5 or $10 copayment per prescription?
All these aspects have a major impact and must be weighed when comparing two different plans.
Demographics
As the name suggests, a group insurance plan is meant for a group! If you work for a high-tech firm where all the employees are under 25, the cost of your group insurance plan will probably be much lower than if you work for an industrial company with an average employee age of 55, even if both plans are identical. Why? Because premiums reflect your group claims and studies clearly show a direct correlation between age and health expenses.
Costs are also impacted by other less tangible factors, particularly with life and disability insurance.
Look at the big picture
When comparing your group insurance plan, you must remember that it is part of your total employee compensation. Your group insurance plan may be slightly less generous, but do you have a generous pension plan? Does your employer provide gym allowances, a health savings account or access to a virtual clinic service? These benefits must all be factored in!
Take action FOR YOUR GROUP INSURANCE PLAN
Do you have questions about your plan’s competitiveness?
You would like to review what you have but you don’t know where to start?
Contact us! We can perform benchmarking to better guide you in your decisions. We can help you find the solutions that really meet your needs and suit your budget!
Group Insurance Plan Advisor | Bachelor of consumer science with more than 15 years of experience in group insurance, Stephanie makes customer satisfaction its top priority. Professional, attentive and honest, she assures you a quality service that meets the needs of employers and insured persons. Stephanie also enjoys understanding and communicating the various issues of group plans.