Group insurance renewal checklist
By: Benefits by Design | Tuesday July 30, 2024
Updated : Monday July 29, 2024When you have employee benefits, a group insurance renewal is not a matter of if, but rather, when. Which means it’s a good idea to prepare ahead of time, so you understand what you’ll be agreeing to for the coming year. Before and during the renewal process, there can be a number of things to be aware of.
We created this handy group insurance renewal checklist so you can ensure you’ve crossed all the t’s and dotted all the i’s.
Your group insurance renewal checklist
Before your renewal
- Confirm your insurance renewal date. Your client manager can advise you of the date if you are unsure. You should receive information from your advisor about your renewal at least 30 days prior to the renewal date.
- Confirm your coverage. What benefits does your plan include? Which ones are pooled – meaning your claims experience is pooled with other groups for consistent rates on benefits such as Life Insurance, which have large claim payout amounts, but a low number of claims overall. Which ones are partially-experience rated? These are benefits such as health and dental care. Are there any new benefits that employees have been talking about that are not included?
- Review your benefits philosophy. Why do you offer employee benefits? Does the reason still align with your current values and goals? Re-align your benefits philosophy if needed, and let it inform your decisions going forward. Ask your employees what they want from their coverage. Anonymous employee surveys are a great way to collect opinions without employees having to divulge sensitive medical information.
- Confirm your premium cost-sharing. Do you pay 100% of the premiums? Do employees pay 50%? If the latter is the case, remember to include their feedback when making any changes or updates. Making decisions without them could backfire if there is a large increase, or you remove something they appreciate.
- Check your plan usage. For employers with over 25 employees, you can request aggregate data on claims for health and dental, as well as Employee Assistance Plan (EAP) usage. You can then use this data to determine trends in claiming. Are any benefits not being used? Are there benefits that are consistently being maxed out?
During your renewal
- Check your running claims experience. This is the ratio of total paid claims versus the total premium that was collected since plan implementation or the last renewal. Your plan will have a target percentage, also known as the Target Loss Ratio, and it is preferable to be close to or under that number. Your renewal package should include this number to explain any rate changes.
- Review for stop loss claims. When claims are above the stop-loss threshold, they are no longer included in your claims experience. However, it is best to be aware of these claims, as they still have an impact up to the threshold. They are also often ongoing – meaning the plan member will usually need to continue with the high-cost treatment or medication.
- Understand any proposed rate changes. During your renewal, your advisor will present you with the new proposed rates. The rates are based on claims experience, demographic changes (such as age, occupation, or location), industry trends, drug pricing trends, regulatory changes, fee guides, and more. Have your advisor explain any decreases or increases that you don’t understand – that’s what they’re there for.
- Decide on plan design changes (if any). Based on your benefits philosophy, plan usage, and proposed changes in premium, you should be able to determine if anything needs updating. For example, if no one is using the vision care, consider replacing prescription glasses and contacts coverage for an increase in the counsellor or psychologist maximums. Or add or enhance the Health Care Spending Account (HCSA) allotment.
Remember, if your insurer doesn’t hear from you by the date of your renewal, they will automatically apply the renewal rates based on the calculations by their underwriters. These are the people who assess risk and trend factors for the insurers and try to estimate future claims experience.
Communicating your benefits after your group insurance renewal
Employees won’t use their benefits if they aren’t aware of them. Ask yourself: “When was the last time we communicated information on employee benefits, and how?”
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Ideally, you should be communicating with multiple touchpoints, and in multiple formats. Especially if there were changes made to the plan based on employee feedback or usage trends.
Start by scheduling upcoming communications that work for as many employee as possible. Consider vacations and time of day, as well as the number of meetings and other events occurring. These communications should be ongoing throughout the year. Try the following formats:
- In-person meeting/presentation/webinar
- Information sessions and employee Q&As
- On-demand learning videos
- Email communications
- Posters/info sheets
- Forwarding provider communications
Group insurance renewals, while they only occur once a year, have a big impact on employee satisfaction, and therefore productivity and engagement. Being diligent when reviewing your renewal can ensure you continue to have a sustainable and successful benefits plan.