The City of Los Angeles compiled some fast facts about small businesses. Throughout California, over 62% of enterprises have up to four employees, and companies with over 100 workers compose 1% of all California businesses. There is less than one percent of companies with more than 500 workers, which means most employers in the state are small businesses.
This means that you will have to handle various processes as a small or midsize business owner. One of those is human resource and insurance topics. Small businesses might not have the means or time to address these issues independently, so an option is to work with a Professional Employee Organization (PEO) that offers insurance services.
What Are PEO Insurance Services?
PEO insurance refers to health insurance administered by a PEO. It can also cover unemployment insurance and life insurance. Any insurance plan that helps employees can be issued by a PEO.
Businesses of all sizes have health insurance obligations under the law. With the Affordable Care Act, those obligations are substantial. When you work with a PEO, they become responsible for offering health insurance instead of the business.
Aside from health insurance, PEOs also offer other insurance plans required for business operations. Some are also optional. The other insurance options you have include:
- Worker’s compensation: This insurance replaces employee wages if they suffer an injury at the workplace or within the scope of their employment. It protects you from lawsuits and helps the employee inasmuch as they can receive benefits from these policies instead of suing the employer.
- Disability insurance: If an employee becomes disabled, they can obtain benefits through disability insurance. The specifics will vary by policy.
- Life insurance: if an employee dies, this coverage will pay out a lump sum to the family. These policies have many nuances.
- Unemployment insurance: the employer will provide some funding into the policy, as will employees. It gives payment in cases of unemployment.
During an assessment, you can decide which insurance policies are necessary for your business and which you need to stay in legal compliance with the state.
Businesses and PEO Insurance
PEO aims to manage pensions, health insurance, and other human resource services for employers. Businesses can find it time-consuming and expensive to handle health insurance independently. By having a third party like a PEO offer and manage the health insurance process, the business owner can focus on other aspects of growing the business.
In recent years, there have been additional benefits for employers and employees by using a PEO. Employees can get better healthcare benefits. Employers will stay in compliance and can get good deals on health insurance.
PEOs can also negotiate better prices for health insurance coverage than individual companies.
Benefits of PEO Insurance
PEO insurance has many benefits. While some have been addressed, here is a closer look at the benefits of Los Angeles PEO insurance services.
Compliance
Health insurance obligations are complex and ever-changing. While large businesses have a human resources department that handles these costs and responsibilities, it is often harder for a small business. International companies also have a challenging time addressing these issues.
Insurance requirements vary by country, and what is required in another country differs. PEO has the resources and knowledge about compliance in every sector.
Plans at Reduced Costs
It is challenging for small to midsize businesses to purchase affordable healthcare plans. The PEO is the sponsor of the healthcare plan. PEO has dozens, if not hundreds, of employer clients which gives them more purchasing power than an independent business owner. They can get highly qualified health insurance with affordable premiums using their purchasing power.
Suppose the PEO has ten employers with ten employees each. They can present to insurance companies that they have 100 employees. The insurance will assess the risk and deem that insuring 100 employees is less risky than ten.
Employer of Records
PEOs take care of insurance concerns but also have other services. They handle payroll and human resources for businesses of varying sizes. They are responsible for withholding payroll, taxes, and general human resources issues.
In a co-employment agreement, the PEO becomes the Employer of Record. You can focus on other elements of your business when your time is not consumed with these complex issues.
NetPEO Finds the Right Partner for Your Business
Working with a PEO has many benefits, like saving time, staying compliant, and taking care of your employees. The hardest part is finding the right PEO to partner with. NetPEO works with employers and PEOs to find the perfect match.
The process is simple:
- Consult: first, we must meet with you to assess your needs. Our agents will learn more about your business, local and federal obligations, and goals.
- Search: Using the information we gather from the consultation, we find you a partner. NetPEO has an extensive network of PEOs in Los Angeles. We will compile a list of PEOs that can serve your needs.
- Support: You might think that after you select a PEO, our job is done. Even after you begin a partnership with a PEO, NetPEO offers support services to help resolve any issues or concerns that arise.
NetPEO makes the process as straightforward as possible to save time and get you back to running your business seamlessly.
Reach Your Business Goals with NetPEO
NetPEO works as a brokerage company to align small and midsize businesses with the PEO that can help take their business to the next level. Compliance and employee satisfaction can help retain good employees. It also means you can focus on other elements of your business while saving money.
You can submit an electronic message or call us for a free business assessment. A NetPEO representative will respond within 24-48 hours. We look forward to helping you reach your goals.
