As a Kansas City insurance broker who has been practicing in the employee benefits world since 1999, I have learned a lot about small businesses, how they work, and the concerns of a small business owner (not to mention that I am the owner of a small business with 5 employees). Among the most important lessons that I have learned in helping hundreds of small businesses secure health insurance for owners and their employees is the following statement:
You don’t have to be a large company to do some really important things!
What I mean by this is that there are thousands if not hundreds of thousands of really small businesses that have very few employees (like less than 10) but they do some very important stuff for their clients and society at large! A couple of examples that I am thinking include one of my companies who makes medicine taste better for children. This company has 5 employees, and because of the work that they do, children around the world are taking medicines that making them healthier. If this important work wasn’t done, lots of children would spit out their medicines and wouldn’t get the health results that they need.
THINK ABOUT THAT! THAT IS IMPORTANT!
Small Business Health Insurance Example
Another one of my clients is a simple heating and cooling company. This may not have the kind of cache as a bunch of scientist who work with medicines, but they are just important when it is 106 degrees outside and your air conditioner breaks down! Furthermore, what if that same breakdown occurs when you have a small baby at home and you need relief from the heat, or if it’s your elderly parent’s or grandparent’s home? The point I am trying to make is that small businesses everywhere do very important work, and the owners and employees of these small businesses are every bit as important as those of us who work for larger businesses!
Unfortunately, the importance of the work being done by small businesses and their employees today does not directly translate into the same quality of business health insurance and other employee benefits that one gets at a large business. There are a number of factors that are just realities that make health insurance and employee benefits easier for larger businesses than small businesses.
- Economies of Scale – It is less expensive to buy things in volume such as health benefits for a large group.
- Access to Capital – Larger businesses that have more money are better able to pay for employee benefits.
However, some of the challenges associated with small businesses accessing affordable and superior health insurance benefits are completely avoidable! From what I have experienced over a long period of time, the main thing standing in the way of smaller businesses accessing insurance that works for them is ignorance. To be clear, we are not talking about “stupidity” but “ignorance” or “not knowing.” Most business owners are smart people; otherwise they wouldn’t be a business owner for long! LOL. But, because they are so engaged in their line of work, they are not always able to stay on top of topics like employee benefits, and how to make them as cost-effective and useful for themselves and their employees as they can be. This is why business owners typically rely on insurance professionals for their help and advice. Unfortunately, for the “small’ small business owners (typically those with businesses with fewer than 25 employees and no dedicated staff member to handle HR and employee benefits), getting the right professional has its own challenges. These include the following observations:
- Some insurance agents and their agencies are TOO BIG to work with smaller companies. This is because, frankly the revenues that are generated from working with a smaller business (<25) is simply not enough to justify going the extra mile to help this business realize cost savings and understand all of the options available.
- Some insurance agents are too small to meet the demands of a small business that has legitimate needs when it comes to identifying the right plans am servicing their plan on an ongoing basis.
In the first case, the larger Kansas City small business health insurance agencies may have the expertise to help a smaller business, but often times staying on top of savings options and service for a tiny client is not on their radar because they have larger fish to take care of. It is unfortunate in many of these cases because, oftentimes the revenue is attractive to the larger agency if they don’t have to service the smaller businesses on an ongoing basis. While this almost never happens, it would be nice if a larger agency was honest about the service expectations for the smaller business or passed on working with the smaller entity. Unfortunately, what usually occurs is originating a plan on the front end and offering a low level of service on an ongoing basis with simple e-mails and few options as the inevitable increases come up.
In the second case, if an insurance agent is too small, then they either working by the self or have one assistant. When these agents (or agencies) end up working with your small business, you die two deaths!
- When service issues come up, the solo agent may not be available to help resolve the issue. If the agent is playing golf, then you may be stuck contacting the insurance company directly. If the agent is overwhelmed with other clients and other lines of business like life insurance or home & auto, then you might be stuck contacting the insurance company directly!
- In may cases, the solo agent may not be knowledgeable enough about the overall market to offer the advice necessary to be of assistance. With only so many hours in the day and so many companies, many solo agents or those with one staff member supporting them end up with a couple of favored carriers and they only focus on them. When this happens, every solution being offered to you, the small business, ends up falling within the offerings of those favored companies.
In both of these cases, whether dealing with a larger broker with little time for a smaller business or dealing with a solo agent who is overwhelmed and lacks knowledge, the loser is you, the small business. Valuable savings opportunities and plan improvements can come when small businesses can find the right fits when it comes to getting help from an insurance professional. In summary, the point that I am trying to make is this:
Regardless of the size of your business, YOU DESERVE PROFESSIONAL HELP THAT PROPERLY ADDRESSES YOUR COST AND BENEFITS!
If you agree with this statement, then all that is left is to learn about the opportunities in the employee benefits market for smaller employers and seek out the help from professional Kansas City insurance agents that you need!