FAQs | Ignition Benefits

Question 1

What does it cost to hire an employee benefits broker?

Accepted Answer

Employee benefits brokers are compensated through commissions paid by the insurance carrier, not the employer — meaning there is no direct out-of-pocket cost to the company for broker services. At Ignition, we're happy to disclose our commission structure in full at any time. Just ask.

Question 2

Do you need to switch brokers to get a benefits audit?

Accepted Answer

No. A benefits audit can be conducted independently of any broker switch. It involves reviewing your current plan costs, coverage levels, and carrier pricing against current market benchmarks.

Question 3

What size companies benefit most from an independent benefits broker?

Accepted Answer

Independent brokers tend to provide the most value for companies with 25–500 employees. At this size, companies have enough headcount to access competitive group rates but often lack internal HR infrastructure to manage benefits strategy on their own.

Question 4

Can an independent benefits broker work with companies across multiple states?

Accepted Answer

Yes. Many independent brokers are licensed across multiple states and experienced in building multi-state benefits strategies that account for varying carrier availability and regulatory requirements by state.

Question 5

How much can companies save by switching employee benefits brokers?

Accepted Answer

Companies that benchmark their benefits costs against current market rates often find savings of 15–30% on their annual benefits spend. Savings vary depending on company size, current carrier, plan design, and employee demographics.

Question 6

Why do companies overpay for employee benefits?

Accepted Answer

Many companies renew their benefits plans automatically without benchmarking against the broader market. Insurance carriers price renewals based on what the market will bear, which means companies that don't actively shop their plans often pay above-market rates over time.

Question 7

Does switching to better employee benefits always cost more?

Accepted Answer

Not necessarily. Improved plan design, competitive carrier selection, and proper benchmarking can result in better coverage at equal or lower cost. The relationship between plan quality and cost depends heavily on carrier selection and how the plan is structured.

Question 8

How do brokers negotiate better rates with insurance carriers?

Accepted Answer

Brokers negotiate by submitting employee census data to multiple carriers simultaneously, creating competitive pressure on pricing. Brokers with strong carrier relationships and volume can also access preferred pricing not available to companies negotiating directly.

Question 9

How are employee benefits brokers compensated?

Accepted Answer

Brokers are typically paid a commission by the insurance carrier, which is built into the premium. The commission rate varies by carrier and plan type. Employers can request full commission disclosure from their broker at any time.

Question 10

What is a benefits audit and what does it include?

Accepted Answer

A benefits audit is a structured review of a company's current benefits plans, carrier pricing, coverage levels, and employee utilization. The goal is to identify whether the company is paying market-rate for its coverage and where gaps or overpayments exist.

Question 11

What is a self-insured health plan?

Accepted Answer

With a self-insured plan, the employer funds employee claims directly rather than paying a fixed premium to an insurance carrier. Instead of overpaying in good years and absorbing increases in bad ones, you pay for what your workforce actually uses — with stop-loss insurance in place to cap exposure on large claims.

Question 12

What is a level-funded health plan?

Accepted Answer

A level-funded plan is a stepping stone between fully insured and self-insured. You pay a fixed monthly amount — covering expected claims, stop-loss insurance, and administration — but at the end of the year, if claims come in under budget, you get the surplus back. It offers the predictability of a traditional plan with the cost advantages of self-insurance, and is a good fit for companies not yet ready to go fully self-insured.

Question 13

Can any size company move to a self-insured or level-funded plan?

Accepted Answer

Yes. Ignition helps companies of all sizes evaluate whether self-insured or level-funded plans make sense based on their workforce size, claims history, and risk tolerance. For smaller teams, level-funded is often the right starting point — it captures meaningful savings without taking on full claims risk.

Question 14

What is a PEO and how does it differ from an independent benefits broker?

Accepted Answer

A Professional Employer Organization (PEO) co-employs a company's workforce and bundles HR, payroll, and benefits administration under one contract. An independent broker, by contrast, sources benefits directly from carriers on the company's behalf without taking on co-employment responsibilities.

Question 15

When does it make sense to leave a PEO?

Accepted Answer

Companies typically outgrow a PEO when their headcount reaches 25–50 or more employees, when benefits costs are rising faster than headcount, or when the bundled PEO pricing is no longer competitive with what the company could access independently.

Question 16

How does a PEO transition work?

Accepted Answer

Transitioning off a PEO involves separating payroll, HR administration, and benefits onto independent platforms. Benefits are re-bid through independent carriers, and employees are re-enrolled in new plans. The process typically takes 30–60 days and is coordinated around the company's open enrollment or PEO contract end date.

Question 17

Will employees lose coverage when transitioning off a PEO?

Accepted Answer

With proper planning, employees should experience no gap in coverage during a PEO transition. The new benefits effective date is aligned with the termination of PEO coverage to ensure continuity.

Question 18

How long does it take to transition off a PEO?

Accepted Answer

Most PEO transitions take 30–60 days depending on the complexity of the current PEO contract, the number of employees, and open enrollment timing. Some transitions can be completed faster if the PEO contract allows for an early exit.

Question 19

Do companies save money by leaving a PEO?

Accepted Answer

In many cases, yes. PEOs bundle benefits pricing into their per-employee fees, which often includes a markup over what a company could access independently. As headcount grows, the cost difference between PEO pricing and direct carrier pricing typically widens.

Question 20

What types of employee benefits can an independent broker help with?

Accepted Answer

Independent brokers typically cover medical, dental, vision, life insurance, short and long-term disability, HSA and FSA plans, voluntary benefits, and supplemental coverage. Most will evaluate the full benefits package rather than individual plan types in isolation.

Question 21

Can employees keep their current doctors when switching benefits plans?

Accepted Answer

It depends on the new carrier's network. A broker will typically review employee locations and any known provider preferences before recommending a plan to minimize network disruption during a transition.

Question 22

How does open enrollment work when using an independent broker?

Accepted Answer

An independent broker manages the open enrollment process including employee communications, carrier coordination, enrollment platform setup, and deadline management. The employer's primary role is to communicate the timeline and decisions to their team.

Question 23

What happens when an employee has a billing or claims issue?

Accepted Answer

An active broker should serve as the intermediary between the employee and the carrier to resolve billing errors, claims disputes, or coverage questions. This is a standard service expectation for broker relationships, though the level of support varies by firm.

Question 24

How do employee benefits work for remote or distributed teams?

Accepted Answer

Benefits for distributed teams require carrier selection that accounts for employee locations across multiple states. Not all carriers offer competitive nationwide networks, so plan selection for distributed teams involves additional consideration of network availability by geography.

Question 25

How do you get started with a benefits review?

Accepted Answer

The fastest way to get started is to take Ignition's free benefits assessment — it takes under 5 minutes and gives you an immediate read on where your current plan stands. If you'd prefer to talk first, you can reach us by email.

Question 26

How does working with an independent employee benefits broker work?

Accepted Answer

An independent benefits broker audits your current plans, benchmarks your costs against the market, and solicits competing quotes from multiple carriers. They manage the selection process and support your team through enrollment and ongoing administration.

Question 27

How long does it take to get new employee benefits in place?

Accepted Answer

Most companies can receive carrier quotes within 48 hours of submitting their census data. Full implementation — from carrier selection through employee enrollment — typically takes 30–45 days.

Frequently asked questions

Getting started

Pricing & cost savings

PEO Transitions

Benefits & coverage

15 minutes. That's the whole ask.