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Can I afford small business health insurance?

small business health insuranceThe number one reason given by businesses for not having a small business health insurance plan is the cost. While many employers think that it would be a nice thing to do; they just can’t afford it. This idea usually comes from just looking at the premiums.

The truth is, when you examine the real cost of health insurance and the ways it protects your business, you will find that your business can’t afford not to have it.

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Here are 8 ways that business health insurance benefits your small business:

1. Attract Good Employees

It is hard to find a good employee. In a competitive market, a benefit package that includes a health care plan, may make the difference between recruiting a top performer or losing them to a rival. In fact, benefits are the number two reason given, behind wages, for selecting an employer. In many cases it may be number one since most businesses cannot compensate enough, with salary, to make up for the loss of benefits.

2. Retain Employees

It costs a lot to hire and train a new employee. It is much less expensive to retain the ones you already have. While a health insurance plan may not mean much to the employee who is young and healthy: as they get older, with family obligations, it becomes increasingly more important. It may even be more important than a raise in salary.

A business, with tax breaks, can provide health care at a much lower cost than the employee could hope to find as an individual. They may even lower their taxes if they use pre-tax dollars to pay for their premiums. Finally, employees with a health care plan are more likely to use preventative care. This greatly reduces the chance of losing an employee due to a long term or fatal illness.

3. Avoid Worker’s Compensation Claims

workers compensation claims

Worker’s Compensation Insurance is fast becoming the major expense for businesses. It is easy to see why. Just one accident, with injury can cost hundreds of thousands of dollars in surgeries, rehabilitation and payments made during downtime. This cost is passed along to the business owner in the form of higher premiums.

The vast majority of worker’s comp claims are filed on Monday. Why? Because the uninsured employee injures themselves on the weekend but can’t afford to go to the doctor. They wait until Monday and then claim that they were injured on the job. In addition, employees in good health tend to have fewer accidents, which lowers legitimate claims.

4. Lower Production Costs

Studies have shown shown that, generally, healthier workers are more productive. Here are some specific examples where the cost of a sick employee can be devastating:

  • In the food processing industry a sick employee contaminates a production run, causing a health hazard and a recall.
  • In manufacturing, a worker misses something on the line that creates a defective product.
  • A driver has an accident because they were not feeling well or were on medication.

Depending on the severity, these types of incidents could be catastrophic. There is also the loss of production due to absenteeism.

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5. Prevent Lawsuits

In the examples given above, just imagine if someone got sick from eating the contaminated food, injured by the defective product or hurt in the accident. The damages from just one incident could far exceed the cost of a health plan. They could ruin the business.

6. Protect the Brand

There are reasons why branding is so important. People want to do business with companies they like. In hard times, a company’s good name can be enough to pull it through. Being known as the “good guy” that takes care of your employees is valuable. Being associated with recalls and lawsuits is not.

7. Protect the Owner

There may be no more critical asset to the business than the owner. Owners need affordable health insurance for themselves and their families. Being part of a group plan is likely less expensive than an individual health insurance plan.

8. Avoid Fines and Penalties

Due to recent legislation your company will probably be subject to heavy fines and penalties if you do not offer a business health insurance plan. These fines could amount to thousands of dollars per month, per employee.

Conclusion

The actual cost of business health insurance, with tax incentives, is far less than the premiums would indicate. In truth, with the right plan the business can deduct all of its premiums and lower payroll taxes. How many product recalls, lawsuits, fines, and worker’s compensation claims can your business afford? What is the value of your company’s good name? Without a business health plan you are just rolling the dice, hoping that none of these will happen.

When you assess the true cost of a business health insurance plan, you will find that the benefits out weigh the risks of going without. Protect your business. Start comparing quotes to find the best rates available. Enter your zip code below to begin!

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