HR's Guide to Employee Benefits Brokers

Plenty of organizations try to figure out their benefit renewals on their own, thinking, “How hard can it be?”

But in truth, with employee attraction, engagement, and retention on the line, plus rising healthcare costs, selecting the right employee benefits can make the difference between a thriving organization and a struggling one. That’s why working with an employee benefit broker — an option so popular that the market was estimated at $43.01 billion in 2023 and continues to grow — is so essential.

In this article, we’ll cover everything you need to know about benefits brokers‚ from explaining what they are and how they differ from benefits consultants to how you can make the most out of your next brokerage relationship.

Why Might You Need a Benefits Broker?

Understanding the benefits of a broker is the first step to planning and deploying a successful benefits renewal.

Beyond alleviating the administrative burden of selecting and procuring an employment benefits plan, the right benefits broker can act as an extension of your team.

The right benefits broker team member can help with:

• Advocating: A well-informed benefits broker can efficiently match your company with the optimal program for its needs. Plus, brokers can often secure better rates and terms due to their industry relationships and negotiating power.
• Navigating: Employee benefits brokers can also help employers with compliance regarding employee benefits, such as adhering to the Affordable Care Act, Family and Medical Leave Act, and more.
• Competing: Run-of-the-mill health benefits options won’t cut it anymore. Benefits offerings have become one of the top reasons employees leave or stay in their roles. Benefits brokers with industry expertise can help you identify emerging industry trends and options for increasingly in-demand benefits like comprehensive mental health, family, domestic violence, and financial planning support.

How Do You Evaluate a Benefits Broker?

When considering a broker and which is right for you, HR teams should consider things like:

• Experience and credentials: Look for industry certifications such as Certified Employee Benefit Specialist (CEBS) or Group Benefits Associate (GBA). Assess their years in the industry and experience with companies in your size and sector. Ask about their successes and setbacks.
• Services: Ensure they offer a full spectrum of services, such as plan analysis, selection, implementation, and ongoing management. Check if they provide additional value-added services, like claims advocacy or wellness program implementation.
• Relationships: Determine if they have preferred status with any carriers, which might lead to better rates or service. Additionally, make sure they're not overly reliant on a single carrier, which could limit your options.
• Industry knowledge: Ask about their understanding of your industry's specific challenges and typical benefit structures.
• Strategic approach: Ask how they would align your benefits strategy with your company's goals, including if they benchmark against industry standards.

How to Make the Most Out of Your Benefits Broker

Many HR teams think their job is done once they hire an employee benefits broker. That’s a mistake. While benefits brokers handle most of the benefits administration process, HR leaders should take an active role in the partnership to provide the best benefits for their employees and the organization as a whole.

Maintain Regular Communication

For a benefits broker to be the best partner possible, emphasizes the importance of companies being transparent.

In a recent webinar on benefits renewal, Krystina Lesiak, Paylocity’s benefits manager, underscores the importance of proactive and frequent communication.

“A benefits broker needs to know your team intimately,” she said. “And in order for that to happen, you need to engage and prepare them.”

Organizations can set up regular check-ins (e.g., monthly or quarterly), define preferred communication channels and response times, and provide brokers with detailed knowledge of their organization.

Provide Comprehensive Data

For a benefits broker to efficiently match your organization with the right benefits program, you’ll need to supply them with robust internal analytics on benefits usage and needs.

For instance, you could provide insights on employee feedback and satisfaction obtained through surveys, data on turnover rates and trends, as well as usage and enrollment rates of existing benefits.

“You [and your benefits broker] don't have to guess what your employees want — you actually have data that will show you exactly what you need to do next,” Krystina said.

Assess Alignment and Success

As you work with a broker, ensure you’re not veering too far off the tracks.

“Consistently revisit and review the statement of work and talk to account executives to ensure that your benefits search and progress for enrollment is aligned with your organizational goals,” says Krystina.

And even when enrollment is over, an HR leader's job isn’t done. HR should continuously monitor data as it comes in and adjust where needed, comparing it to benchmarks.