Your Benefit Program Needs Spring Cleaning Too…
Spring is the time of year that brings with it a longing for warmer weather. It also brings a desire to have things clean and in order. This is a perfect time to give attention to the administration side of your benefit program. We have compiled a list of topics that you may want to think about for a spring cleaning.
Many benefits are tied to salary. Are the salaries for your employees correct with your insurance carrier? If these are incorrect there is a ripple effect of coverage and resulting premium amounts being inaccurate.
It is good practice to periodically review beneficiary information with your employees and/or have them check this with your insurance provider directly. Do employees have the correct and current beneficiary listed for their Life benefits? It is important for employees to know that if there is no beneficiary, proceeds of any Life benefit payments will go to their estate and subject to probate procedures.
Enrolling employees on your program within a timely manner is essential. The time frame to enroll varies by insurance provider so it is important to be familiar with your contract provisions. Do you have all eligible employees enrolled on your benefit program? Also, have you terminated employees off the program who no longer work with your organization? If an enrollment of an employee is missed, they may be considered late applicants under certain circumstances. Late applicants will likely be subject to providing satisfactory medical evidence of insurability, putting them at risk for being declined coverage all together.
Having the correct employee data on system with your insurance provider is important. Do your employees know to communicate life events to you in a timely manner? Remind employees to notify the Plan Administrator within 31 days of the following lifestyle changes to avoid disruptions, or worse, denial of coverage:
- Change in marital status
- New baby
- Spouse obtaining or losing coverage through their employer
- Over age dependent children attending post-secondary education
Insurers may require original documents in the event of a death or disability claim. Are your original enrollment forms retained and organized in a secure location? The last thing you want in a critical situation is to be looking for (or unable to locate) this information.
Establishing written policies pertaining to your benefits is crucial. Do you have written policy outlining how benefits will be extended to employees away from work for extended periods of time (i.e. layoff, maternity leave, disability)? The policy should be clear with respect to premium payment and duration of benefit extension so that all parties understand your internal practice.
Employers should carry insurance to protect themselves in the event of an act, error or omission in the administration of the company’s employee benefit plan. Do you carry Employee Benefits Liability (EBL) Insurance? Oversights can happen with respect to your benefit administration, it is better to be safeguarded.