Employers of all sizes are increasingly interested in using benefits platforms to help them make the most of the benefits they offer and to streamline their administration processes. While the biggest employee benefits consultancies have their own platforms, for most intermediaries, it is a case of partnering with a benefits platform to support employers. Some platforms partner exclusively with intermediaries while others also go direct to employers.
Partnering with a particular benefits platform provider will ideally be a long- term arrangement, and picking the right one is, like any relationship, down to a clear understanding of what they have to offer and how they operate.
Advisers want to see commitment to the market, a vision for the future and the ability to embrace all types of benefits. This report analyses key players in the market in terms of their functionality, business model and charging structure.
Other providers were contacted but declined to respond to our request for information.
Employee benefits administration platforms – size and structure
Benefex is the biggest of the providers surveyed in terms of the number of employers it serves, with 900 employer clients live at present, closely followed by Avantus HR and Zest of 800 and 700 respectively. Cloud8, which was recently acquired by Benefex, was founded in 2019 and launched its BEAM at Work proposition aimed at intermediaries in the same year. It has reached 280 employers since then.
Strait Logic’s partnerships with intermediaries have included relationships with Buck, Corinthian, Corpad, Cushon, Evolve, IHC Employee Benefits, LifeWorks and Wren Sterling.
The employee benefits platform sector is a complex one with multiple different models in place. Edenred, Reward Gateway, Mintago, Mybenefitsworld, Workday, Gusto, Benify, Benni and Spectre all offer different propositions that can demonstrate the value delivered through employee benefits programmes via engagement tools.
YuLife positions itself as an employee benefit provider, rather than a total benefits administration platform although its system does offer some of the functionality offered by providers in this survey. This includes salary sacrifice for pensions, the option to select pension, health and cash plan and retail discounts. Its minimum contract term is annual, with 24-month contracts for risk policies.
All providers in this survey offer advisers the ability to white label their service. Some also have an intermediary arm of their own.
Administration functionality and charging structure
All providers offer self-serve administration functionality for employers and employees, and most offer the ability for administration support to be offered as an extra service.
Minimum contract terms range from one month for Coroni, to three years for Avantus HR, Cloud8 and Zest. Some, but not all providers offer set-up fees, with most charging on a per-employee and/or functionality used basis.
These charges are those fees levied to employers. Advisers then charge employers for setting up the system – Cloud8 cites examples of clients charging between £5,000 and £10,000 for setting up the system plus an annual licence fee of £5,000, with some more complex, bigger clients having a higher charge.
Partnering with platforms also gives advisers the opportunity to offer improved consultancy, communications and reward/ recognition schemes, as well as the ability to expand the range of products they deliver to a client.
Range of benefits offered
All platforms offer a wide range of functionality, including salary sacrifice on pensions, the option to select pension, health and cash plan, retail discounts and reward statements.
Future developments
As the world of employee benefits continues to evolve and digital adoption accelerates, benefits platforms are looking to improve and increase the functionality they offer. Employers are looking to target the benefits they offer more effectively, which means having the ability to offer more personalised and more flexible benefits packages. Having the right benefits technology in place is crucial if this is to
be achieved.
Zest says it has development plans that will enable it to add capabilities to its platform that will allow people to more effectively target messages, understand how people are engaging with both the platform and with other communications that are sent, and how that engagement ultimately connects to tangible business outcomes.
It says its platform will be able to track those tangible business outcomes in far more detail than it does today.
Cloud8 says it is planning many more APIs to make the journey between best of breed workplace solutions, such as HR, payroll, pension, savings, health, reward & benefits, seamless for people to make relevant informed choices. It is looking to develop better data insights for advisers and employers. This can support demographic needs and will save on comms and admin costs in the long run.
YuLife has taken a big stride forward in the market with its gamification engagement approach and other providers may endeavour to replicate this in their propositions in future,
Strait Logic is currently upgrading its underlying technology from .NET 4.8 MVC to .NET Core v8, with a release date pencilled in for mid 2024. It is looking to introduce improved administration functionality around data imports and staging, as well as improved employee journeys around the flex selection process, as well as more flexibility and customisation across several other areas of the platform.
Avantus HR is targeting full global capability, premium partner integrations and enriched user experience with AI assistance.
Meanwhile Coroni has planned both short- and long-term developments. Short-term plans include more automation of existing features such as single sign-on, multi-factor authentication and secure, automated data transfer to and from benefit providers. Medium-term plans are to expand the application suite, including customer requirements to manage subscription benefits through expenses. Over the longer-term
Coroni plans include investigating the scope for embracing artificial intelligence and more automated processes.
Benefex says it plans to give employees greater flexibility around what counts as a benefit, using AI to drive better benefits content and employee support, and helping employers showcase their culture through reward tech are themes driving its current roadmap.
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