For most businesses, employees are the single largest expense. That includes not only wages, but also the cost of employee benefits.
And if you’ve been through an insurance renewal recently, you might have felt like you were negotiating at a car lot instead of running a company.
You're not imagining it. The process has become just that transactional.
The Insurance Renewal Game
Every year, it’s the same story:
- The insurance carrier sends a renewal notice
- It shows a massive increase — often 20 to 30 percent
- The broker steps in to “negotiate it down”
- You end up with a smaller increase or reduced benefits and are expected to feel like you got a deal
Sound familiar?
This isn’t just frustrating. It’s strategic.
The Illusion of Savings
Here’s how it works:
- The carrier starts with a 30 percent increase
- You push back, negotiate with your broker
- You land at 10 or 12 percent and feel like you won
But did you?
Sometimes the premium stays the same, but benefits are quietly downgraded:
- Higher deductibles
- Reduced coverage
- Excluded services
That’s not a win. That’s cost shifting, and employees end up footing the difference.
Why Is This Still Happening?
Ask yourself:
- Would you raise your own client fees by 30 percent just to “negotiate” them down to 15 percent?
- Would your clients accept that model every year?
Of course not. But that’s exactly how renewals are structured for most businesses in the insurance market. The system is broken, and it has become normalized.
What You Can Do About It
If your renewal letter just landed in your inbox, it’s not too late to take action.
Here’s what to keep in mind:
- A 28 percent increase is not “normal”
- Reducing employee benefits isn’t your only option
- If your current broker keeps telling you this is just how it works, it may be time to look elsewhere
Advocate for Better Health Benefits
- Push back on lazy advice
- Ask for data to justify the increase
- Request alternative funding models or plan designs
- Find an advisor who will advocate for your business and your people
You and your employees deserve better than a yearly pricing game.
Final Thought: You’re Not Powerless
The insurance renewal process doesn’t have to be a rigged negotiation. There are options, strategies, and partners who can help you make better decisions without sacrificing your people or your bottom line.
If you’re ready to rethink your benefits strategy, we’re here to help you do just that.
