Two ways to manage rising health and benefits costs facing small and medium-sized enterprises

People are the biggest assets to SMEs, so it is not surprising that rising health and benefits costs top their list of concerns. Employee health and benefits premiums and related costs ranked first in our People Risk 2024 survey as the most likely people risk that will affect their business in the next two years, and with the most severe impact.¹

Several factors are behind the steady climb in benefits costs. Inflation is putting a pressure on medical costs, with medical trend rate in Asia projected to reach 11.4% in 2024, continuing a trend of double-digit increases every year since 2022.² Insurers have also become more selective on who and what they will insure as people are utilising private health insurance more often and for more severe claims.

Investing in people is a top priority, so maintaining competitive rewards, and health and benefits programs when costs go up is a major concern. 30% of SMEs noted this concern in our latest People Risk survey, with 37% saying they worry about the impact of rising costs on HR and resource expenses to manage benefits programs.³

Although it is harder to plan when future insurance premiums and other costs are uncertain, here are two key actions SMEs can take to help control costs without sacrificing competitive benefits.

1. Lock in premiums for less market exposure

Exploring the possibilities of locking in premiums can help SMEs ensure predictable expenses and protect their budgets even as the market fluctuates.

2. Use a broker for a competitive price and choice

Working with a broker can provide more program choices for SMEs and help secure the best prices. A good health and benefits advisor can help SMEs access a wide range of choices to customise their benefits package, offer benefits that stand out while keeping costs low.

For SMEs keen to access attractive terms and conditions that make the most value of their budget, partnering a broker can allow the scale advantage which are typically available to larger organisations.

Did you know that Mercer Marsh Benefits helps SMEs get the most from their budget?

Our size gives us the advantage to negotiate. Our global reach and exclusive relationships with various insurers can help bring you more affordable choices and effective terms and coverage.

^{1 People Risk 2024 (Mercer Marsh Benefits)}

^{2 Health Trends 2024 (Mercer Marsh Benefits)}

^{3 People Risk 2024 (Mercer Marsh Benefits)}

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Top people risk facing small and medium-sized enterprises

1. Lock in premiums for less market exposure

2. Use a broker for a competitive price and choice

Did you know that Mercer Marsh Benefits helps SMEs get the most from their budget?

Choose Mercer Marsh Benefits and Select More Value.