The renewal of health and benefits programmes of foreign subsidiaries, regardless of their size, is like diving, regardless of the depth : it must be prepared!
A priori, a 50-meter-deep dive would require more preparation than a 5-meter dive, which would not require any preparation at all?
And yet, a lot can happen, such as getting your hands on a stonefish, finding yourself in an adverse current, coming across a shark or getting back on the wrong boat. The same goes for the monitoring and steering of the health and welfare plans of your subsidiaries abroad, their budgets might be under the radar of the materiality threshold for Finance. This materiality threshold, which has perhaps not been set either?
How do you know if you are exceeding the materiality threshold if you don’t know how much you spend for your employee benefits ? With the medical inflation significantly increasing together with disability claims, how do you anticipate your renewals?
We advise to start the process as early as possible and suggest the following checklist :
- check the notice periods well ahead to anticipate possible changes in local providers,
- ask for your claims experience (including charges and expenses) with the renewal conditions,
- carry out a demographic study n and n-1 to understand major changes in the workforce
- check the external factors affecting premiums amounts (such as exchange rates, inflation, medical inflation, legislative changes, changes in the insurance market).
- this may be a good time for a survey : ask employees for their opinion and improve the employer brand.
- escalate, listen and gather complaints,
- make the decision to change insurers,
- launch a call for tenders,
- include the plan into a multinational pooling program,
- align plans renewal dates on the same date (or two dates such as 1st January and 1st July) for all plans and countries,
- Communicate changes,
- pass on positive messages,
- update the intranet and onboarding documents.
- ensure the proper organization of enrollments, terminations, changes of beneficiaries,
- review the payroll deduction and payment of premiums process
- Finally, make sure you track this precious data and information
In other words : yes you do need to prepare to make the employee benefits diving experience as positive for the employer as for the employee.
