Service model comparison
PEO vs. benefits broker
A broker shops your benefits; a PEO moves you into its own co-employment group. They are different buying power, not a better or worse version of the same thing.
PEO
- Employees enroll in the PEO's sponsored plans through co-employment
- Buying power comes from the PEO's total covered workforce
- Bundled with payroll, HR, and risk administration
- Exiting requires a planned transition of plans and records
Benefits broker
- You shop the market and select your own group plans
- Buying power comes from your own census and the broker's carriers
- Broker compensation is usually paid by the carrier or an agreed fee
- You keep plan continuity and control of renewal strategy
How should you make the decision?
Start with the work your company needs performed, the decisions that require internal ownership, the amount of day-to-day capacity required, and the risks of changing models. Then ask providers to map their scope against that operating picture.
A model is not a quality guarantee. Service teams, implementation, systems, pricing, and contract terms differ materially within every category.