Buyers Guide

A Buyer’s Guide to Benefits Administration Software

One of the primary responsibilities of any human resources (HR) department is the management of employee benefits: tracking time off, handling employee health insurance, savings plans, pensions, payroll, and so on.

Performing such duties is often a long and arduous task when taken care of manually, and this is why many businesses choose to invest in benefits administration software instead. Helping to streamline these processes, such technology is very popular – and there’s a lot of it available to choose from.

So when you’re in the market for it yourself, how do you know which is the best HR software to pick? Well, you can always use this article to help you. Specifically written to guide you through the selection process, we hope you find it useful…

Key features of benefits administration software

We felt that the best place to begin this article was with an exploration of the common features you can expect to find when you go shopping. As the benefits you administer will often represent a large expenditure, most systems will offer ways to keep track of your outlay, and this is really important.

This information can of course be contained in a spreadsheet for those who wish to use manual methods, but where a company has more than a dozen or so employees, this becomes almost impossible to manage yourself.

Benefits administration software thus comes in handy here. Helping you to monitor your expenses, as we mentioned above, it will usually offer the added boon of allowing employees to see this information for themselves, and alter their benefit elections as they wish.

As a result, common capabilities will likely include:

• Online benefits enrolment: This type of software is most useful when it allows employees to enrol for benefits like healthcare online.
• Employee benefits administration: Most applications will have the additional advantage of enabling HR to easily manage employee benefits in a centralised location.
• Accurate reporting: Organisations should also be able to use this software to ensure compliance with any legal obligations and to file any necessary paperwork or reports that need to accompany these.
• Compensation statements: Additionally, organisations should be able to display to employees the value of their package of benefits.

We further suggest that you look out for the following:

• The ability to integrate your benefits packages into one easy-to-manage location.
• The ability to run analyses and reports.
• The ability to initiate and manage open enrolment.
• Self-service portals which allows employees to change their elections as they see fit.

The types of benefit management system available: a look at current trends


Before you can focus on choosing a benefits administration system that includes the many important features listed above, you first need to understand the types of software that are available to you.

These can be split into two separate categories of deployment: on-premises and web-based. The former is hosted by your own servers; the second by remote servers which can be accessed through a web browser.

When it comes to choosing between the two, there are many factors for you to take into account, with the first of these being cost. On-premises options tend to require an upfront outlay to purchase the software and use it in an on-going capacity, whereas web-based systems are more likely to levy a monthly subscription from you instead.

It is the latter option that tends to be particularly popular with smaller businesses, in large part because of these financial considerations, with SMEs often lacking the funds to purchase an on-site alternative outright.

The latter has convenience in its favour too. In particular, most purchasers will prefer to have a self-service feature, one which allows employees to log themselves in in order for them to keep abreast of their benefits. Web-based systems are usually ideally suited to providing this, as they don’t require users to go through the HR department in order to access them, but rather, can be logged into from any device with an internet connection. This not only suits the employees themselves, but also reduces the amount of work HR admin teams and small-time entrepreneurs have to take care of, leaving them free to pursue more profitable tasks.

Nor must we ignore the security boons provided by web-based systems. As most small businesses cannot afford to invest in costly data protection for their own servers, is it usually better to rely on a third-party provider, who will have the funds and technology necessary to deliver an exceptional degree of security.

Which type of benefits administration software is best for your business?

With the above in mind, web-based benefits administration systems may seem like the natural choice when settling on your preferred purchase, but it’s important to assess what will be best for your business, not businesses in general.

There are an exceptional number of products to choose from, and you need to know how to narrow things down. According to research, certain selection tactics are more effective in helping business owners to do this than others, and these include the following:

• Consider your budget: Before you begin making a selection, be realistic about your budget. Work out how much you can really afford to spend, and then look specifically at what options this opens up to you.

• Check vendor references: One of the best ways to assess software is to take a look at the reviews which are available for it online. These should give you a good idea of what you can expect from the product, as should asking for and checking vendor references. Try to gain as clear a picture as you can of the system so that you can decide whether or not it will really complement your business.

• Have a lawyer review your licence or subscription agreement: To make sure that your company benefits from its investment, you might also want to have a professional cast their eye over your licence or subscription agreement, to check that everything is as it should be, and your business is properly protected.

Following the advice provided in this article, you should have no issue finding the ideal benefits administration software for your company.