It is no question that the economy in Calgary is tanking. It is a scary thought. With layoffs happening every day and revenue plummeting in all sectors there are certainly questions about how to cut costs. The challenges being faced by businesses right now need to be addressed on a social and financial level. How can businesses make small adjustments to meet the challenges they are facing without hurting their remaining and future employees? And what opportunities actually come out of these economic challenges? Now is the time to retool and refocus.
We as Albertans understand that the oil industry is cyclical and if we are resilient enough to tough out these hard times then things will come around full circle. But in some cases we may need to make some adjustments in order to do so. Businesses and employees understand the importance of maintaining a level of coverage that will allow them to ward off any potential health issues and to prevent health concerns. They understand that irradiating plans will only hurt them in the long run and that there is a balance between benefits and budget that they can explore during these times of hardship.
One small adjustment is to turn your Cadillac plan into a Chevy and top it up with a Health Savings Account (HAS). It won’t have all the same shiny benefits as before, but it also won’t leave you and your employees high and dry when they need it most. A properly adjusted HAS will keep your employees covered in the areas that they deem important and keep you from dishing out for non-essential features.
Another option is to take advantage of a pooled plan vs. an experience rated. A pooled plan is 30,000 businesses across Canada sharing pooled claims experience and corresponding rates. An experience rated plan focuses on you as an individual policyholder and could be detrimental depending on past claims. A pooled plan that is run on a not-for-profit basis is the most cost effective way to provide coverage that keeps rates stable. There are stabilization reserves in place and when there is a surplus of premium vs. claims, the surplus is used towards the next year’s claims. These savings then lower renewal rates below health inflation factors. Normally the increase is below 5% even though health care inflation is double digits – over 10%. Last year the Chamber Plan had a $9,000,000.00 surplus resulting in great savings for its members.
So what does this all mean for you? And what opportunities are presenting themselves during these economic changes that we can help with?
Many companies use times like this to get back to basics. They retool, rebuild, and restructure so that their vision accommodates a new normal and takes advantage of technologies and systems they may have overlooked before. For employees, it may open up opportunities for entrepreneurship, contracting, or consulting that they have always wanted to explore but had never been able to take the leap towards. They can now finally take the time to re-evaluate their situation and decide if they are on the right path, and make sure they have the right coverage in place to ensure their needs are met.
FFG Solutions has the answers when it comes to the plan best suited for your ever-changing business. We are here for support and advice, even if it just means a simple clarification that you are on the right track. If your needs are greater and big changes are ahead, contact us for a detailed consultation. We will customize a strategy on which adjustments to make in order to meet the challenges your business is facing in the current economy.