The last thing on your mind as the school year kicks into high gear is your benefits package. Your contracts are signed, excitement is at its peak, and all systems are go. However, now is one of the best times to start thinking about your employee benefits and perhaps consider a change. It’s low-pressure season for insurance, meaning you can start shopping around for alternative providers at your leisure.
Why bother making a change?
Great question. Here are a few reasons why schools look for different carriers. Has your current broker/agent talked to you about:
- Mission-appropriate package
- Cost efficiencies
- Wellness and health programs
- Changing landscape of health care
- Broker relationships/negotiation power
While these are sensible reasons for seeking a new provider, the most important is having a broker who understands your school and its mission in order to help you to provide a mission appropriate portfolio of benefits.
There is a trend happening where schools and companies alike are forced to chase low premiums year after year. This can actually cause more stress than benefit. For the first year, you’re likely to be welcomed by an introductory low premium that pleases everyone. Come the following renewal season, however, you’re faced with a HUGE increase, which pleases no one and sets you out on yet another search and seek adventure for a provider who can help keep your budget within a workable range.
Changing providers year after year also doesn’t allow time for you to build a relationship with your broker. As you know, schools operate very differently from most organizations. Having a broker who understands your mission and values is critical to your school offering mission-appropriate packages.
What’s the solution?
Before you start searching, write down what benefits are mission-appropriate to your school: Take note of what benefits you are currently offering and what benefits you would like in addition. Next to each benefit, make a column to write down how it protects your faculty, staff, students, and/or facility. (For example, next to short term disability, you might jot down that this protects your younger faculty members who might start thinking about family planning; hence it protects your budget by paying out a percentage of their salary your payroll would otherwise have to compensate for.) Now make another column and include how much money you have to spend from your strategic financial plan allows for insurance coverages. This will become you guide when reviewing different packages.
With time as an advantage and your brainstormed guide in hand, you can begin your search ahead of schedule. By gathering estimates now, you’ll be better-prepared to make a decision come renewal season—a calm, stress-free decision. Here are a few tips to help you through your research.
- Ask a maximum of 2 alternative brokers to “bid” on your programs (plus your current assuming you’re happy with them)
- Be certain to do due diligence on the broker and firm
- Get references
- Note those that provide NEW solutions, not merely lower cost for status quo
- During the initial interview, ask what they know about YOUR school (ask your current broker the same question)—see if they’ve done their homework and really care enough to know about your school
Additional ISM resources of interest:
ISM Monthly Update for Risk Managers Vol. 2 No. 3 Managing Risk by Understanding Your Insurance Policy
Additional ISM resources of interest for Consortium Gold members:
I&P Vol. 35 No. 9 How to Scrutinize an Insurance Policy
I&P Vol. 34 No. 12 Directors and Officers Insurance: Why Your School Can't Afford To Be Without It
I&P Vol. 34 No. 6 Reducing Insurance Costs: Request for Proposal
