Experts say the pandemic has accelerated e-commerce by five years. But what about its impact on the group insurance industry? That’s a conversation few are having.
A year into COVID-19, many companies are finally taking a closer look at their group insurance plans. In 2020, most businesses hesitated to make any changes—big or small—due to the uncertainty of the pandemic. Now, having adapted to the “new normal,” they are resuming operations, but in a way that is anything but business as usual.
Rising Premiums Despite Fewer Claims
Many companies have reached out to us after receiving premium increases, even though health and dental claims dropped significantly in 2020. This raises a key question: Are insurers’ rate adjustments truly reflecting reality?
Our analysis shows that despite a sharp decline in claims for much of 2020, premiums have remained stable or even increased. This trend exposes a major flaw in the traditional group insurance model.
The Traditional Group Insurance Model No Longer Works
If your company is facing a premium hike, chances are you’re stuck in an outdated insurance model. The traditional approach—where businesses market their plans every few years, receive an initial discount from insurers, and then see rates bounce back the following year—is no longer serving employers or employees well.
For companies with more than 30 employees, a hybrid self-insured model is often a smarter alternative. It provides greater flexibility, better cost control, and ensures employees get the coverage they need—without overpaying.
It’s Time to Rethink Your Group Insurance Strategy
Now more than ever, businesses need to reassess their group insurance plans and explore solutions that better align with today’s realities. A proactive approach can help optimize costs while ensuring employees receive meaningful coverage.
If you’re looking for better options or simply want to understand what’s possible, speaking with a group benefits expert could be a game-changer for your business.
