PEO Insurance: The Key to Affordable Employee Benefits

By Jenny Barnes on May 30, 2024
4 min read 0 comment(s)

Share this:

PEO-insurance (1)

As a small business owner, you strive to attract the best talent to your team. While salary and job descriptions are key factors, a comprehensive benefits package is equally important. PEO insurance, a type of group health insurance tailored for small businesses, can make a substantial difference in employee satisfaction and retention.

Recent surveys show that approximately 78% of workers in the US are eligible for an employer-sponsored insurance plan. What does this mean for your small business? In order to remain competitive with large corporations when it comes to attracting and retaining top talent, you'll need to offer great benefits.

RELATED: 5 Tips for Choosing the Best Health Insurance for Your Small Business >>

How PEO Insurance Can Benefit Small Businesses

When it comes to health insurance costs for employees, most small business owners agree that they need to carefully weigh the expense against the ROI. The size of a company can sometimes make employer-sponsored health insurance cost-prohibitive. Keep in mind, employee benefits can equate to as much as a third of an employee’s total compensation. PEO insurance helps alleviate this burden by providing cost-effective solutions.

Working with a professional employer organization (PEO) can have a measurable impact and make health insurance for Kansas City-based businesses far more affordable than it otherwise might be. PEO insurance provides a solution that helps small businesses offer competitive benefits.

What is a PEO? Simply put, a PEO offers comprehensive HR services and solutions to small and medium-sized businesses via a co-employment arrangement. The PEO partners with small businesses for tasks such as payroll, benefits administration, human resources, workers’ compensation and other business-related functions.

Unlike a staffing company, a PEO is a co-employer and partners with clients to handle HR, payroll, benefits and workers’ compensation, assuming the role of the employer of record. This means the PEO is responsible for filing payroll taxes and other related tasks.

The Benefits of PEO Insurance for Small Business: Cost Savings

Because PEOs are the employer of record for larger numbers of employees across multiple clients, they can access more favorable insurance rates. Here's how it works:

Insurance providers base premiums on employee numbers, so smaller companies typically pay higher rates. Partnering with a PEO allows small businesses to leverage a much larger “pool power,” leading to more affordable premiums. PEO insurance is a game-changer in this aspect, resulting in significant cost savings.

RELATED: Small Business Health Insurance Options >>

Other Key Benefits of PEO Insurance

In addition to the cost savings and administrative relief, there are several other key benefits of PEO insurance that make it an attractive option for small businesses.

1. Access to an Expanded Health Insurance Marketplace

Running a business is challenging, with numerous moving parts, and small business owners often wear many hats. Working with a PEO like Axcet HR Solutions provides entrepreneurs with the benefit of extensive network insights and connections, sourcing multiple options to find the best provider for each individual company.

2. Giving Employees Key Health Advantages

Ensuring that your employees are not only productive but also taking care of their well-being is crucial. Happy and healthy employees promote a positive company culture, leading to a thriving professional environment. Partnering with a PEO company in Kansas City to secure the best health insurance options gives your employees a critical advantage in maintaining their health.

3. Ensuring Health Insurance Coverage Is Competitive

A typical small business scenario involves an employer spending countless hours reviewing providers, premiums, and plan options, only to choose one that exceeds their budget. Frustrated and with little time to spare, the employer may overlook meaningful annual reviews, resulting in higher costs the following year. Axcet performs thorough annual reviews to ensure that benefits remain relevant and competitively priced.

4. Getting Help with Claims

Claims being denied are not uncommon. Disputing claim decisions can be a time-consuming and frustrating process. When collaborating with Axcet, business owners don’t have to spend valuable hours trying to resolve issues. We handle communication with insurance representatives and navigate the claims process.

5. Staying on Top of Compliance Issues

Health insurance and employee-healthcare-related laws and regulations at the state and federal levels can be extremely complex and ever-changing. Not being in compliance due to overlooked legislation can result in significant penalties. Small businesses can’t afford to be non-compliant. Working with a PEO ensures your business remains compliant with all relevant regulations. PEO insurance helps mitigate these risks. 

New call-to-action

Axcet: A Trusted Partner for Affordable PEO Insurance

Small business owners are sometimes expected to be experts in all aspects of their company, including understanding the complex world of group health insurance—this shouldn’t have to be the case, nor does it have to be. You have the option of working with a PEO that specializes in matching small business budgets with optimal coverage.

Schedule a consultation to learn more about what we can do for you with PEO insurance.

New call-to-action

Written by Jenny Barnes

Get HR Updates

Table of Contents

Top Considerations for Implementing Return to Office Mandates

return to office mandates
severance pay

Severance Pay: Are You Unknowingly Obligated to Pay?

Let us know what you think...