Those who own or work for a small business may not realize that they are eligible for group health insurance, as they often are. There are many insurance companies that offer group plans for organizations with two to 50 employees; these plans are aptly referred to as small business health insurance plans.
Benefits of Small Business Health Insurance
Of course, the biggest benefit is that all small company employees will be eligible to receive health insurance. Their companies will be required to pay a certain percentage of employee premiums, while employees contribute the remainder of the premium. In some cases, coverage may also be extended to the employees' families. However, the company is not required to pay a percentage of the family members' premiums. Regardless of how the payments for the premiums are divided, with group insurance, everyone will be able to share in the benefits of group coverage.
Group coverage often has premiums that are lower than individual coverage. Also, group health insurance plans offer more comprehensive coverage than individual plans. Group plans usually offer more for less.
In addition, there are tax advantages for both the employer and employees. Any employer contributions towards health insurance may be 100 percent deductible. The money that employees contribute toward their own health insurance is paid for out of pre tax dollars, lowering their amount of taxable income.
Offering group health insurance can help a small business attract better qualified employees. Highly qualified employees usually are looking for a benefits package, and health insurance ranks among their top concerns.
Choosing Small Business Health Insurance
Small businesses cannot usually afford to offer more than one type of health insurance, and must choose from fee-for-service, HMO, or PPO plans. The decision is largely dependent on financial feasibility as well as the needs of employees.
Group health insurance premiums are based on a variety of factors, including:
- the age of those being insured their health status
- hazards of the job
- location of the business
- tobacco usage
In order to obtain an accurate quote, it is best to have this information collected before you shop for group insurance.
Once you have all of the necessary information, compare the rates and benefits of many different insurance carriers and plans. You can have an insurance agent assist you with this, or you can perform the research yourself. With the convenience and ease of comparing rates and benefits on the Internet, comparison shopping is not difficult to do.
After you have received a number of quotes, determine which plan is affordable for both you and your employees, while offering the best benefits for your money. The plans that best meets these needs will be the optimal choices for you and your employees."
