Before designing an employee benefits program, it is important to define your objectives.
Is it to:
– attract and/or retain talent?
– compete against your competitors?
– provide peace of mind to your staff and their dependents?
– Do you want the same benefits for all or do you prefer to let your staff choose the coverage they want?
Once you’ve defined the objectives and determined the budget, consider the following questions that must be answered prior to designing an employee benefits program.
1. Who is covered under the plan?
The key purpose of an employee benefits program is to provide basic security for your employees. It is therefore important to cover every employee, from worker to management. You may consider providing different levels of cover according to the job grades. To enhance the program, you may also provide medical coverage to the dependents, which will certainly be well received as it is often challenging for employees to provide proper cover for their loved ones who are not working.
2. What benefits to provide?
Many companies may just consider putting in place a coverage for medical expenses, as it is the most obvious expense faced by the staff. However, you must also consider what will happen if your staff is diagnosed with a critical illness, or meets with an accident and becomes disabled. Even if the cause is not work related (which will be covered by work injury compensation), shouldn’t the company provide a minimum safety net on top of what each individual should already have in place? We usually advise our clients to put in place a group term life, accidental death and dismemberment plan as well as critical illness for all employees. This will protect their family and help your employees focus on their recovery. The sum insured should be based on a multiple of each employee’s salary to provide the right level of cover across the board.
3. Can pre-existing conditions be covered
One of the advantages of a group plan is that it’s easier to cover pre-existing conditions (Medical History Disregard – MHD). This is especially important for Employment Permit holders. Every employee gets the same coverage with no exclusion, regardless of their medical conditions. Different insurers will require a minimum headcount in order to underwrite such a plan with MHD starting from 6 employees.
4. Any extra budget?
After putting in place your employee benefits program, if you have extra budget, you could consider offering your employees the possibility of adapting the group coverage to their own individual needs. Then you could consider a flexi-benefits platform depending on your group size. It will allow your employees to take control of their own employee benefits program and adapt it to their specific requirements by improving their coverage. Or, use the extra budget to enjoy a gym membership, a vacation or a health improvement program, etc. Such a platform will usually require an initial set up cost.
5. Which insurers should I partner with?
There are many offers in the market and selecting the right insurer/platform is key to the long-term stability of your employee benefits program. Most insurers offer direct billing network and online portal. But how to choose and review the difference in conditions/service? Ask an insurance intermediary to help you navigate through the policy details and provide you with a comprehensive comparison of the benefits and services of each insurer in the market.
Designing your employee benefits program requires a lot of careful consideration. At Clema Risk Solutions, we can help you optimize your employee benefits strategy.
For information about our various insurance solutions for SMEs, please visit our website.