Employee Benefits: The Basics

By: Mary Thompson, Capstone Brokerage President, November 16, 2017

Setting up employee benefits for your small or large business should not be a headache. Incorporating benefits into your employee package is a way to attract and retain employees. With all the changes to the way health care coverage has been implemented since the Affordable Care Act (ACA), to now with possible changes, it is no wonder business owners are concerned about what to offer in their package and what is necessary. One of the biggest hurdles is the basic understanding of the change in requirements that have been implemented in the industry over the past several years. Let’s go back to the basics and explain what a desirable employee benefits package may include.

A Group Health Insurance

This is the only mandated coverage small businesses need to offer depending on the number of employees. However, one thing remains the same, that a company offering healthcare for their employees is not only required but also wanted and desired by employees. So, keep in mind even the most basic healthcare coverage is better than none at all.

Group Dental Insurance

Dental coverage is not required to be part of a benefits package; however, it is typically not as expensive as health insurance for a business. This makes it one of the most common added benefit options offered to employees. It is highly recommended to have optional dental coverage for your employees, even if the coverage is only for basic dental checkups. With many options available, such as dental health maintenance plans, group dental plans, and Dental PPO coverage many small businesses can offer at least some level of dental coverage to their employees. When you go the extra mile and offer your employees optional dental coverage, businesses can expect to attract and retain employees at a higher rate then those that do not offer dental coverage.

Vision Plans

Vision coverage is also not required for businesses and like dental is more affordable than health insurance to add to your employee benefits package. Vision insurance can include, eye exams and coverage for a broad range of frames, contacts and lenses. A vision plan can help to protect employees vision and even their overall health. Regular eye exams not only help people see clearly but also can detect serious conditions and illnesses. By offering optional vision coverage, you may gain a leg-up on other employers, which can help you with attracting and retaining employees.

Life Insurance

Life insurance coverage can help the employee’s named beneficiaries in the event of an unforeseen employee death. These benefits can help the person’s family cover funeral and ongoing living expenses. Having a life insurance option while not required enriches the overall benefits package and can set your company apart from others who do not offer it. It is an added benefit that a business can include that won’t cost too much for the business as employees can contribute up to 100% of the premium.

Disability Insurance

There are two options to offer to employees to cover disability, long term and short term. This insurance provides coverage in the event the employee is injured or has a lengthy illness such as cancer. Having a disability option as part of a business’s benefits package, is a way to enrich the benefits package again without costing the business too much out of pocket.

Retirement Benefits

The most common retirement benefit is a 401K. A 401k allows a certain amount of the employee’s salary to be deducted tax free towards a retirement savings plan. Some businesses will even decide to match that deduction amount or contribute a percentage. Including a retirement plan to your employee benefits package can truly show that the business cares about the employee’s future. Again adding this optional coverage can set your business apart from the rest.

The most basic benefits package for full-time employees is medical insurance. Including additional coverage options such as vision, dental, life, disability and retirement options can set your company apart from others. Not only to make your business a more desired place of employment, but also to help with employee retention. Larger employers typically offer some, if not all, of the coverages discussed here. As a small business it is something to consider when creating or upgrading your employee benefits package. Offering the additional coverage options is a smart choice for small businesses and does not have to be expensive. Both employers and employees can contribute to the added benefit options. We are dedicated to helping our clients have the most affordable options in their benefits package. For more information about your current benefits package or about adding any additional coverage be sure to discuss at the time of your renewal with your agent.