Will a smaller group change our renewal?
It can. Carriers price the group they see at renewal, so a layoff belongs in the conversation before it.
What the carrier looks at.
Group Size
Fewer employees can change the rating basis and, in some cases, the market the group is rated in.
Participation
Participation rules apply to the group as it stands at renewal.
Claims
A smaller group can be more sensitive to a few large claims.
How it plays out.
A carrier prices a renewal using what it knows about the group at that time: the number of employees, the enrollment, the ages and the claims. A layoff changes the first three directly, and can change the fourth over time.
What happens to the rate depends on the group, the carrier and the market. A smaller group is not automatically more or less expensive, but it can be rated differently and can be more affected by one large claim.
The safe approach is to bring the layoff into the renewal conversation early and ask for the reasoning behind the number. If the number does not make sense, there is time to compare other options.
How we help.
A broker should take work off a smaller HR team, not add to it.
Raise It Early
We help bring the layoff into the renewal conversation before the carrier prices.
Run the Read
We help run the renewal through DATUM and show where the number comes from.
Compare Alternatives
We help compare other carriers and plan designs for the new group.
Before the renewal.
Update the Census
Send the carrier or broker a current census.
Ask for the Reasoning
Ask how the layoff and group size affected the rate.
Run an Independent Read
Have the renewal reviewed against the group’s own experience.
Compare Alternatives
Get options from other carriers and plan designs.
Mistakes that cost money.
Staying Silent
A carrier prices on the data it has, so tell it what changed.
Accepting the First Number
The first renewal offer is a starting point.
Waiting Until the Deadline
Late comparisons leave little room.
Related guides.
Right-Sizing HR After Layoffs: The Benefits Workload
The full picture.
Participation and Contributions After a Layoff
Carriers set participation and contribution requirements.
Right-Sizing the Group Health Plan
After a layoff, review plan design, contributions and funding for the smaller group before renewal.
Is HR carrying more than it should?
Tell us what changed, and we will show you what to take off the desk.
Your renewal letter
Your census
Your current plan documents
Your renewal date
Rough answers are fine. We build the numbers from there.
An independent employee benefits consulting firm. We look at the entire benefits program — cost, plan performance, risk and administration.
Switch to CFH. Unhappy with your broker? Your employees won’t notice. You will. →
Cookies on This Site
We use cookies to keep the site working properly and to understand how it is used. You can decline anything that is not essential. See our Privacy Policy for the detail.
- Essential — needed for the site to load and for you to move around it. These cannot be switched off.
- Analytics — tell us which pages get read, so we know what is worth writing more of.
- Advertising — set by third parties such as ad and social platforms to measure and target campaigns.