Can an Employer Work Directly With an Insurance Company?

Yes, there is a possibility for an employer or company to transact directly with an insurance provider. This is usually done through the assistance of a group of sales personnel who will negotiate and process the acquisition of group insurance. The underwriting practices, as well as the premiums, differ per insurance carrier. Furthermore, the coverage will be different in each insurer. This is due to the nature of the deal. The employee benefits shall be created in such a way that it meets the requirements and budget of the company or employer. It is customized differently per client. For this reason, the comparison of plans with other insurance companies will not be possible since the requirement of each client is never alike. Unless, it is a mega corporation that is considered an extremely important account; insurers would probably take the time to present what they can offer.

It is because of this reason why a number of group insurance purchasers, in this case, the employers, do not prefer to directly transact with sales representatives from insurance companies. For them, the best option is to negotiate with an intermediary. These middle men are more equipped with experience and resources to search for an insurance carrier that suits their company and can accommodate their needs. Intermediaries or vendors will help their clients define their terms, objectives and create design plans that best achieve those goals. These professionals will also assist the employer in choosing how to fund the purchase of insurance plans, in addition to finding the best plan with the most reasonable rate.

In this generation, it is even more important for insurance providers to develop their products and strategies because employer expectations are changing. New trends are quickly entering the employer-insurance provider relationship. Since health insurance expenses are rising faster than the profit of most companies, employers are now looking for more savings and benefits in every penny they invest in health. Studies are being made to determine how satisfied these paying customers are and what other expectations they have from insurance companies that cater to the needs of their staff.

According to the study made by the Health Research Institute, there is no consistency in satisfaction ratings. In fact, smaller firms that employ fewer than 250 employees are less satisfied with their insurer-provided services. Employers see the need for more information when it comes to health benefit programs. They would like to have access to more data in order for them to assess the costs and value of the programs that they are currently using. Measuring actual figures would help employers manage their insurance expenses in more cost-efficient means. It is their preference to work with fewer intermediaries when it comes to the management of employee benefits relating to health. Majority of large employers stated that wellness services, in their opinion, are as important as basic tasks; for instance, giving the insurance benefit to the right person and giving discounts to insurance purchasers. This is opposite to the response of small employers, amongst whom only 50% agreed.