Employee benefits advisers are responding to the growing trend among employers, particularly small and medium-sized enterprises (SMEs), of pooling benefits to achieve global cost efficiencies.
For example, Willis Group restructured its global benefits in January, combining its existing employee benefits and related consultancy practices. It did this to develop and execute a co-ordinated global strategy.
Also in January, Allianz launched a global benefits practice to address the needs of multinational employers. Allianz Global Benefits aims to help these employers optimise benefits schemes internationally.
Insurance broker Lockton has also seen growth across its global benefits businesses.
Mike Tyler, head of employee benefits at Lockton, said: “We are actively strengthening our existing locations and working with our global partners to further extend our global reach.
”We expect this pattern to continue and quicken in the next few years as more organisations push into multiple countries and will seek advisers.”
Benefits pooling is a particular trend for which employers are seeking support. This involves advisers negotiating discounted rates for global benefits schemes on behalf of employers, which can be useful for SMEs with smaller budgets and workforces.
Adrian Swarbrick, senior consultant at Gallagher Employee Benefits, said: “This has been recognised by multinational pooling networks for some time. Most will have a multi-employer vehicle, so SMEs are able to pool their benefits without requiring thousands of staff on a worldwide footprint.”
Employers are also using advisers to help ensure they comply with the different legal requirements in the countries where they operate.
John Ritchie, chief executive officer at group risk provider Ellipse, said: “Employers are always trying to leverage the bar and try to do things globally. Employers are always looking to harmonise benefits delivery and design.”
Tom Gaynor, employee benefits director at Met Life, added: “Employers are seeing the benefits of economy of scale.”
What benefits advisers are doing
- Willis Group restructured its global benefits practice in January to create a new human capital and benefits practice.
- Allianz launched a global benefits practice to address the needs of multinationals.
- Lockton has seen growth in its benefits businesses.
- Met Life is talking to advisers about pooling benefits.