The Many Advantages of PEO Insurance Services

July 5, 2024・6 mins read
PEO Insurance

Small to medium-sized businesses often struggle to provide the insurance coverage, better known as benefit options, they need for themselves and their hard-working employees. It's a complicated process — not just finding premium insurance coverages, but also managing open enrollment periods, payments, and more.

Managing insurance coverage through benefits enrollment requires specialized knowledge. It's expensive. It's time-consuming. It's heavily regulated; in fact, your company may be required by law to offer certain insurance coverages. And in today's competitive labor market, it's very important to employees.

  • 60% of employees rate benefits as very important to job satisfaction, according to a survey done by the Society for Human Resource Management.
  • 80% of employees who are satisfied with their benefits are also satisfied with their job, according to a survey done by the Employee Benefits Research Institute.

Findings like this have led many businesses to sign up with PEOs to outsource human resources functions and enhance the insurance coverage offered to employees. In this article, we'll look at how PEO insurance benefit services can benefit businesses and their employees.

PEOs and Their Role in Insurance Benefits Administration

PEOs, or professional employer organizations, are companies that help small and mid-sized businesses with their HR functions. Instead of dealing with the hassle of payroll processing, benefits administration, risk mitigation, and much more, businesses get help for these critical tasks from the expert hands of a PEO.

Benefits, such as dental, vision, and health, are sponsored by the PEO rather than the client company. Besides health insurance benefits, PEOs can provide access to disability insurance, life insurance, and more.

Leverage benefits expertise

As a small business owner trying to do what's right for employees, you could spend hours researching health insurance options. You also could work with an insurance broker who has more expertise and knows what benefit plans might suit your needs. Either way, you would still need to spend yet more time building the structure within your company to handle all the intricacies of benefits, open enrollment periods, COBRA compliance and other tasks.

Or, by outsourcing HR to a PEO, you could consult with its experts as they offer access to an array of plans and services. At the same time, you could take comfort in knowing that you don't have to worry about the headaches of benefits administration and compliance support.

Premium benefits for employees

PEOs provide access to big-company benefits. With a PEO, businesses can get access to benefit plans from regional and national carriers, each offering multiple plans with a range of deductibles and copays—so your employees can choose plans that best meet their needs. As a result, your company and employees can get more cost-effective insurance benefits and offer premium level benefit packages.

This could include:

  • Medical, dental, and vision plans from leading carriers, possibly with health savings accounts
  • 401(k) plans
  • Dependent care
  • Short-term and long-term disability options
  • Pet insurance and property insurance
  • Life insurance plans, with supplemental coverage options

Better service for employees

According to the Aflac 2023-2024 WorkForces Report, 82% of employees stress the importance of being able to manage benefits online.

Professional employer organizations use their technology platforms to make it easier than ever for employees to interface with their PEO-sponsored benefits. A PEO can offer mobile apps for convenient administration of benefits, online portals for easy enrollment, chat bots to answer questions, and other services that might be out of reach for the average small business.

Advanced software can even help employees identify optimal insurance plans, making it easy to reach important decisions that affect the health of themselves and their family members.

With the benefits decision support tool, users can get personalized answers during open enrollment and onboarding, as well as when life changes dictate changes in benefits. They also can discover benefits they could be using but aren’t, based on their own unique needs and goals.

These digital tools from PEOs promote financial wellness and can be cost effective through the analysis of hundreds of data points and employee input to help calculate total out-of-pocket expenses.

Improved employee retention

Because professional employer organizations tend to work with multiple carriers, they provide national and regional plans where your employees live and work, allowing you to attract top talent. In a job market where employees and their families place value on comprehensive coverage, you have a better chance to attract and retain great people by offering robust benefit packages.

And, according to a survey published by the insurance services giant WTW, 78% of employees are more likely to stick around because of their benefits program.

Ease of administration

The administration of employee benefits, as noted earlier, is a complex affair. It involves plan selection, tech solutions, payroll deductions, open enrollment, ACA compliance, and more.

A professional employer organization takes care of these pieces for you for those on PEO-sponsored plans, simplifying the benefits enrollment processes and with less headache on employee picking their plan with helpful digital tools. A PEO with a fully integrated benefits solution may also offer:

  • Expert-led new hire orientation with benefits enrollment support
  • On-the-go benefits management for employees through a mobile app
  • Timely and sensitive benefit communications
  • Automated payroll deductions for greater data accuracy

Expert benefits compliance

Ensuring that your plans comply with employee benefit regulations and the Affordable Care Act is a full-time job in and of itself. A PEO can deal with benefits compliance, providing expert guidance and compliance support for their sponsored full-service benefit and retirement plans.

Compliance support may include:

  • Delegation to the PEO of administrative responsibility for health plans, as well as primary fiduciary responsibility for retirement plans to minimize your risk
  • Integrated ACA compliance and reporting
  • Management of COBRA administration for former employees participating in plans, including notices and payment collection

PEO Solutions

TriNet is a tried and true PEO with a wide range of services for small and medium-sized businesses. TriNet not only provides HR expertise, a technology platform, payroll administration, and risk mitigation. But our benefit experts will support you every step of the way as you navigate benefits administration, helping your employees get access to benefits they deserve at cost effective prices.

Employees choose an optimal healthcare plan based on their needs. The AI-driven app support customer employees based on their specific benefits information and needs.

Tell your employees that their well-being matters by enhancing your HR administration and providing them comprehensive HR services including access to big-company benefits today with TriNet.

This communication is for informational purposes only, is not legal, tax or accounting advice, and is not an offer to sell, buy or procure insurance.

This article may contain hyperlinks to websites operated by parties other than TriNet. Such hyperlinks are provided for reference only. TriNet does not control such web sites and is not responsible for their content. Inclusion of such hyperlinks on does not necessarily imply any endorsement of the material on such websites or association with their operators.

ESAC Accreditation
We comply with all ESAC standards and maintain ESAC accreditation since 1995.
Certified PEO
A TriNet subsidiary is classified as a Certified Professional Employer Organization by the IRS.