A professional employer organization operates as a human resources department on an outsourced basis. PEOs are common in small and medium-sized businesses which do not need an HR department on site. Some of the things that a PEO can manage include HR management, administration of benefits, and help when complying with employer-based laws.
When you have a PEO, they are often responsible for providing your medical insurance. The advantage of this system is that a PEO usually has dozens of clients, which means the PEO may have hundreds of employees for which the coverage is provided. Many insurance companies offer more attractive rates for PEOs because of the large amount of staff who will be covered by the policy. It is also common for these policies to be of a higher quality for the price paid.
Other Advantages of PEO
While PEO insurance is already an attractive option, PEOs can also provide you with other things your business needs. Having these additional services makes the price of a PEO more reasonable and gives you peace of mind knowing HR problems are handled correctly.
Choosing to bundle insurance from a PEO along with other services can drop your workload and save you money. It is an excellent option for anyone who has a small business.