How to Choose an Insurance Consultant

Audrey M. Jones
Insurance Consultant

An insurance consultant helps businesses find and craft the best employee benefits packages. These consultants may also be referred to as "employee benefits consultants."

How a Consultant Helps

An insurance consultant helps a business select and create benefits to offer employees. This requires the consultant to:

  • Review employee needs: The types of perils that a business' employees are exposed to can help identify the types of benefits that should be offered, such as health insurance.
  • Review the business' needs: The consultant reviews what types of help the company needs, such as managing a life insurance policy program, from an administrative standpoint.
  • Reviewing the business' capabilities: How much a company can offer its employees and stay within budget is a major concern for employee benefits consultants.

After reviewing these considerations, a consultant will search the relevant industries, such as the insurance industry, to find benefits options that meet a business' needs. He or she will then combine these plan options into a package and present them to the business owner or operator. It is up to the owner or operator to select the plans that will be purchased, but the consultant can help implement the package.

Some consultants also assist businesses in managing their benefits packages. This may take the form of processing payments, setting up administrative agencies to help manage insurance plans, or periodically reviewing plans to ensure that they continue to meet the business' needs.

Determining if You Need a Consultant

When considering whether to hire someone to assist you with crafting an employee benefits package, the Journal of Accountancy advises considering:

  • Your time and energy: If you're stretched thin running a business, you may want to hire outside help crafting a benefits package.
  • The complexity of the package you want to offer: The more benefits you would like to offer, the more complex the research, packaging, and setup will be. If you want to offer an extremely complex package, consider hiring a consultant.
  • Your HR Representative's capabilities: Your human resource representative may be able to conduct the research and create a plan for your business. If you seek a basic plan and your HR Rep has engaged in the task of creating a benefits package before, you may not need an insurance consultant.
  • Your funding: Hiring a consultant is not without cost. Some insurance plans pay consultants for selling their policies, but this may not cover the entire cost of a consultant's work.
  • Your goal: If you want to cut costs or seek assistance administering plans, a consultant might be the way to go. However, you might be able to finish the job yourself if your goal is to review your current package.

A consultant can save you time, but might cost you money. However, money spent on a consultant may pay off in the long run in the form of savings on purchased policies.

Find an Insurance Consultant

Recently, Risk and Insurance published a list of the top 2102 insurance benefits consultants. Each of the consultants on this list exemplified excellence in helping companies find benefit plans or saving money on plans. Several are Registered Employee Benefit Consultants (REBC), a designation that indicates advanced knowledge of plan funding, administration, and installation.

Several large, private companies also offer benefit plan assistance.

Aon Hewitt

Aon Hewitt provides HR consultant, HR business process outsourcing, and benefits administration services. Human Resource Executive and Risk and Insurance consistently recognize it as one of the best employee benefits consulting companies.

Plante Moran

Plante Moran's consulting services encompass providing advice about employee health benefit plans, stock ownership options, and employee retention plans. It not only helps located plan options, but also provides tax, legal, and accounting compliance advice. The firm has assisted companies in a variety of industries as well as non-profit organizations and government agencies.

Lockton

Lockton works with a business' HR team to administer benefits plans, enhance benefit plans, and increase employee retention. The company is one of the largest privately held consulting companies in the U.S. and can search globally for benefit package needs. It provides assistance with insurance carriers and administering plans.

Employee Benefit Consultants

Employee Benefit Consultants' services include medical claims and care management, administering health and wellness programs, and providing insured products. It focuses on health risk-management solutions and operates throughout the United States.

Choosing a Consultant

There are many employee benefits consultants, but not all are suitable to work with you for your business' needs. When choosing a consultant, the Journal of Accountancy recommends considering:

  • Whether the consultant has worked for companies of similar size
  • The consultant's fee structure
  • The background and expertise of the entire consultancy team, not just the lead consultant
  • The consultant's references and the consultant's willingness to provide references
  • REBC designation or other certifications

A consultant with extensive experience working with a company of your size and finding the types of benefits you seek is likely to be able to assist you satisfactorily.

Working with a Consultant

When working with a consultant, it is important to set clear goals. This specifies for the consultant the exact tasks you want him or her to undertake, which may help save on the cost of hiring the consultant since he or she will not engage in unnecessary work.

The Journal of Accountancy also recommends starting small, particularly with a new consultant. Giving the consultant a small project to begin with helps you gauge whether he or she can meet your business' larger needs. Consider giving the consultant a single task or two, such as finding a new health or life insurance plan for your employees, rather than revamping your entire benefits package.

Be Direct and Open

It is also important to relay your expectations. Tell the consultant if you're not just looking for him or her to find you policy options, but instead to explain the overall financial impact of any policy or package on your business. This will ensure that the consultant provides you with the analysis you seek.

When working with an insurance consultant, openness is the key. Not only should the consultant be open about how they can help you and their experience, but you should also be open about what you expect and seek from the consultant.

How to Choose an Insurance Consultant