“Benefits pooling” provides cool, lasting relief

As summer starts to heat up, Saskatoon’s business owners are taking a fresh look at their employee benefits and seeking for relief. For many, rates have increased – often dramatically – at a time when small and mid-sized businesses are already treading water.

Forget the mirage of traditional plans that promise savings and fall short. A cool and calm oasis awaits employers through something called “benefits pooling.”

A pooled benefits plan involves multiple employers combining their benefits coverage into a single pool to share the risk and costs of claims across the entire group. This risk sharing helps stabilize rates, particularly for small businesses, and allows insurers to offer more affordable premiums.

According to Jewelian Berry at Wiegers Financial & Benefits in Saskatoon, this concept of “risk sharing” is attractive for most employers since pooled plans spread the risk of high claims across the group of participating businesses. It also means stable and predictable rates.

“A pooled plan means that if one business experiences a higher-than-average number of claims, the costs are shared across the entire pool, preventing drastic premium increases for that specific company,” explains Berry. “By pooling resources and claims, insurers can also offer more stable rates for all participating groups, regardless of their individual claims history. This predictability can be especially beneficial for smaller businesses that may struggle to afford individual coverage.”

At a time of escalating costs – to operate, to hire and to retain great people – any relief is welcome news to business owners or operator, observes Collin Willms with Aurora Workplace Solutions in Saskatoon. “The risk sharing inherent in pooled plans allows insurers to offer lower premiums to employers, making it more affordable to provide benefits coverage.”

According to Willms, Chambers Plan is Canada’s leading pooled plan with over 32,000 businesses participating. It pools premiums for Life, AD&D, Disability, and Critical Illness and are only adjusted based on the company’s age demographics.

The Health and Dental portion is partially pooled, which means small businesses can take advantage of the protection from the pool and a renewal that only seeks to adjust for a portion of the prior year’s deficit (if there is one).

“At the end of the day, benefits pooling can be the best way for small businesses to compete for great people and bigger margins,” says Willms. “More and more employers are jumping into pooled plans and feeling relief from the high costs and stress of their current ones.”