Group health insurance more often than not comes from an employer. Health insurance helps protect an individual or family from financial loss for costs incurred because of sickness or injury. Compared to individual insurance, Group insurance offers several advantages to both the employer who offers the insurance and the employee who gets the insurance. There are a number of reasons why it makes good business sense for employers to offer insurance benefits to their employees and their families. The following are some ways that purchasing a group policy can benefit you, your business, and your employees.
Why Buy Group Insurance?
Group insurance offers its customers access to affordable health services and improves their access to services that may otherwise be unaffordable. People with group health coverage are protected financially from burdensome debts arising from major illnesses or injuries. The need for medical services usually happens unexpectedly and the costs often exceed what most people can afford to pay. Having Group insurance may also encourage people to actively maintain their health because people with Group insurance can obtain medical care, including preventive services that over time, may help persons avoid more serious health problems. Businesses can also benefit from group coverage in ways relating to employee retention and tax benefits.
That’s because any expenses an employer incurs related to health insurance, whether for employees or for dependents, are one-hundred percent tax-deductible as an ordinary business expense, on both state and federal income taxes. Employees may also benefit from tax deductions before state and federal taxes are calculated and deducted, which increases the employee’s take-home pay and lowers the amount of the employee’s taxable income. However, it is recommended that you consult with a qualified accountant to find out how that benefit works exactly and while you are at it, make sure to ask about how the Affordable Care Act offers small businesses healthcare tax credits to help offset the cost of insurance.
A Larger Risk Pool Equals Lower Cost
Another advantage of group health insurance for employees is that the higher number of people that sign up to buy the insurance in the group, or pool, the lower the cost and greater the overall value. That is because when more people are included in the group insurance, the options increase, thus increasing the value of the plans being offered. The professionals from GroupEnroll.ca note that a larger risk pool enables better insurance plans to be offered to everyone in the group at a lower cost with more coverage for pre-existing conditions. Because risks are spread across a larger group of people, costs stay low. Since businesses get better rates for insurance than individuals it makes sense for a business owner to extend group coverage to employees.
Happy Healthy Employees Equals Retention
Having Group insurance is an important part of feeling safe and having peace of mind, so when employers provide that for employees, for the most part, employees appreciate it. Furthermore, being healthy has a lot of perks, both on the job and off.
Obviously, healthy employees are an asset to any business because employees that are well will take fewer sick days and they will be more likely to focus on their jobs, see the doctor for regular checkups and be upfront with their employer about any health problems. It also goes without saying that happy employees are generally employees willing to work hard for the company and stay with the company for a long time.
Group insurance benefits can be vital for attracting the right talent to your company and retaining it. Therefore, businesses that offer health insurance as part of their employee benefits package are able to attract and retain more qualified applicants than those who don’t offer any group insurance. This is because it generally costs more for someone to obtain an individual or family health insurance policy than it costs to get employer-sponsored coverage.
Group insurance can play a significant role in forming a better bond between employers and employees because most employees rate health benefits as a very important contributor to job satisfaction. When you look carefully at the advantages of group health insurance, it is easy to see that there are a lot of reasons to seriously consider it from both the employer and the employee’s point of view. One of the biggest benefits of group insurance for both the employer and the employee is cost savings. Ultimately, having group health benefits can help workers prioritize their health, keeping them well, and on the job.
