Ready! Set! Outsource It!
Ready! Set! Outsource it! Part 2
People start small businesses for a variety of reasons. They see an untapped opportunity in the market. They’re tired of working for someone else. They realize that they can help others out with their product and that makes it exciting for them. They’re also very passionate about what they do and want to share that passion with the world around them by being selfless to share and solve everyones problems.
But no matter what led them down the entrepreneurial path, few – if any – small business owners can say they launched their venture because they were excited about dealing with what goes on behind the scenes. We’re talking about human resources. Payroll. Taxes. Insurance. All the time-consuming activities that don’t move the needle in terms of bringing in revenue but are necessary to keep the business afloat.
For small business owners who want to grow their companies, outsourcing these tasks makes a lot of sense and the best solution could be hiring a PEO.
A PEO, also known as Professional Employer Organization, allows owners to responsibly and cost effectively offload the management of human resources and employment-related tasks including risk management, tax compliance, payroll and much more. Additionally – and this is a big one – PEOs have the ability to leverage economies of scale to obtain high-quality health insurance and other benefits at affordable prices.
“These days, employees have a lot of choices in where they want to work,” said Patrick Moraites, a partner and VP at Tampa-based Axis Group. “Companies that can offer strong benefits and insurance packages will definitely have a leg up in terms of attracting and retaining talent.”
But beyond health insurance, PEOs can also be hugely helpful in securing workers’ compensation coverage, something that can be challenging for new companies in high-risk fields such as construction and manufacturing.
If you’re a small business owner, you’re probably nodding your head and opening a new tab to Google PEOs right now. But not so fast, my friend. Choosing a PEO requires a lot of due diligence. That’s because not all PEOs are created equal and what works for one company may not be the best option for another, even if they’re part of the same industry. Fortunately, brokerages like Axis Group – which has the largest PEO vendor network in the nation – exist to help guide business owners through the process of selecting a PEO at no cost to them.
Because these brokerages are well versed in the ins and outs of PEOs, using them can save you a lot of time from a research standpoint. That’s time that can then be used to meet with clients, service current customers and focus on other tasks that will help make your business more profitable. When you consider how valuable your time is and how important it is to pick the right PEO, it definitely makes sense to outsource this activity to the experts!
However, if you opt to go it alone, we’ve provided a list of questions that you’ll want to ask prospective PEOs regarding insurance (and be sure to check out the other questions we covered in Ready! Set! Outsource It! Part One). If there’s something you don’t understand, ask them to explain it in more detail. After all, when it comes to your business, you don’t want to make the wrong decision!
- What is your work comp deductible?
- What is your work comp loss ratio?
- What is your work comp mod rate?
- When is your work comp effective date?
- How much premium is on your master work comp policy?
- Do you report our work comp losses to NCCI/WCRIB/CRIB?
- How many work comp carriers/master policies do you have?
- Do you have deductibles with every carrier?
- Do you have a master health insurance policy?
- If yes, what carrier and is it national or regional coverage?
- What is the minimum number that must be enrolled?
- What are the health plan participation requirements?
- What is the minimum employer contribution level?
- How many plan options can be offered to employees?
- Is it required to use your master health plan or will you offer our current plan?
- Does the CSA require a personal guarantee?
- What is the CSA termination policy and procedure?
Do all these acronyms have your head swimming? Axis Group is here to help. We’ve worked with hundreds of business owners across the U.S. and we know we can find the right PEO to handle your unique needs. Contact us today for a no-obligation consultation.