When trying to organize a health insurance plan and manage employee benefits, human resources professionals are often confronted with an array of agents, consultants and brokers from which to choose. It can be confusing to navigate through this sea of professionals, so it is important to understand how the system works before plunging headlong into the insurance pool.
There are three ways that insurance brokers and consultants make their money, and the distinction impacts how a company will fare with different benefits management groups. Some brokers receive commissions from the insurance carriers as a reward for bringing them business. These people are usually insurance agents and are employed by the insurance company.
Brokers and consultants, on the other hand, will usually be paid a fee by their employers. In this case, the employer is the party seeking insurance. However, some consulting groups work closely with insurance companies and make their money from both employer fees and insurance carrier commissions.
Rather than blindly exploring the confusing landscape of health insurance and employee benefits, it is often more efficient and a great deal more cost-effective to contract a benefit services organization with the expertise and experience to save companies money and find the most appropriate insurance plans.
