Don’t forget key housekeeping items during in-person renewals

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We all know that there are many reasons to meet with our employee benefits clients every year, and the renewal rate adjustment doesn’t need to be the primary reason. The change in cost certainly needs to be on the agenda…but does the employer know how critical it is to check on numerous housekeeping items on an annual basis?

Just like ensuring your spouse knows you did the dishes last night, housekeeping is best done when the client knows you are doing it. So, besides discussing the difference in premium, here are five other reasons to schedule a renewal meeting:

1. Salary updates: Giving an employee a raise is often a rewarding experience for the employer. But after the bookkeeper is informed and payroll taxes are updated, the small business owner or plan administrator may forget to update the insurer. If the plan provides disability coverage or has a life insurance benefit based on earnings, then the salary needs to be updated as soon as possible. If or when a claim occurs, it is imperative that the accurate benefit is paid.

2. Non-evidence maximum increases: Once you have accurate salaries for the employees, you can show the employer the impact of increasing the non-evidence maximums (NEMs) on the disability, life and critical illness insurance benefits. Any time we can increase an employee’s insurance, without subjecting the employee to a health and lifestyle questionnaire, is a positive move. You never know who has a pre-existing condition or health concern, and to show the opportunity to increase coverage automatically is a value-add service.

3. Excess insurance: Beyond the NEM increase, it is our duty to illustrate to the employer who is eligible for even more insurance, based on their earnings. It is then the employer’s duty to pass that information on to the employees in question, and we can help with that communication to ensure that it happens. We’ve heard countless stories of court-ordered payments by employers to disabled employees who didn’t know they were eligible for more insurance. Help lower the liability for your client with this one simple illustration.

4. Employees nearing termination age: All carriers have termination ages for their benefits, such as age 65 for Long Term Disability. Sixty-five is also a key age for the reduction of Life Insurance and Accidental Death and Dismemberment. And while an employee or employer may intuitively know that benefits can change or terminate at age 65, how many know that their LTD will terminate four months before their 65th birthday (based on a 120-day waiting period)? By informing the employer, who can then inform the employee, you are taking that extra step. The employee may not want or have an opportunity to replace that insurance, but they are all the wiser about their insurance plan. Not only that, but this information can be a head’s up to payroll, who will ensure the deductions are changed at the appropriate time. Many insurers do not send out communication about this change (to the employer or employee), so it’s important that we bring it to their attention.

5. Correct premium deductions: In addition to the renewal adjustment, all the aforementioned housekeeping items have an impact on the billing. Some employers only check their billing once a year, if at all. With any of these changes, the premium deductions on a premium-sharing plan must be adjusted. Encourage the plan administrator to scan the bill each month and adjust the changes in real-time. Nothing is more frustrating to a bookkeeper and employee to have to figure out retro-active adjustments.

We know that business owners are busy. And we are all tempted to simply send a renewal over email or in the mail, if we are unable to secure a meeting. However, proper plan maintenance and explanation of the intricacies of a benefit plan can’t always happen over email. If the employer or plan administrator simply cannot meet for the pending renewal, then be sure to schedule a mid-year meeting – preferably in person, but perhaps over the phone – to ensure the housekeeping happens. As we know with our own houses, the dust can only build up for so long before the house is a mess.

Nicole Ardiel GBA, CHS, BA, is an Employee Benefits Specialist with McVagh Cunningham Group Ltd. in Victoria, B.C.

Transcontinental Media G.P.