Should My California Business Offer Dental Insurance to Employees?

Attracting the best talent means you have to stand out with the benefits your business offers. It’s no longer enough to have standard health insurance (which is now mandatory in California since 2020). Jobseekers are also looking for extra benefits such as optical and dental coverage.

Jobseekers can afford to be picky. The odds are in their favor, with employees desperately trying to fill vacant spots within their organizations. There is so much choice out there. Only those offering the best deal will attract the right staff.

If you’re not currently offering dental insurance, here’s why you should.

What is Dental Insurance and Why is it Necessary?

Most health insurance plans omit optical and dental coverage. Therefore, it’s necessary for an individual to purchase additional policies to cover these two items.

Suffering from dental issues can mean an employee is absent for long periods of time, particularly if they don’t have coverage to get the issue seen.

What Are the Benefits of Offering Dental Insurance?

While providing dental insurance to your employees does cost money, it does come with several benefits, so you do get a return on your investment.

  • Healthy employees are happier and don’t take as much time off work. If dental issues can be addressed quickly, your staff won’t have any downtime for toothache.
  • An attractive benefits package is a must to attract the brightest talent. Those who have highly desirable skills know they can take their pick from employers. If your benefits package isn’t up to standard, you’ll lose out – every time.
  • Once you have employees on board, your benefits can make or break your retention rates. If you have a high staff turnover, then it’s time to take a closer look at your staff perks.
  • You can potentially claim a tax credit on the cost of the dental coverage (more on that below).

Why You Should Enrol in a Small Business Health Options Program (SHOP) Plan

A Small Business Health Options Program (SHOP) is essentially the health coverage you provide to your employees. The insurance must come from a SHOP-registered insurance provider. There are many different insurers out there, and you can choose from a variety of plans and options.

SHOP is exclusive to California-registered businesses and you can only apply for SHOP plans if you meet the following criteria:

  • You have between 1 – 50 FTE (full-time equivalent) employees
  • All FTE employees must be offered coverage
  • At least 75% of employees must take up the insurance
  • Your office must be based in California

Claiming the SHOP Tax Credit

If you enroll in a SHOP plan, you can claim a Small Business Health Care Tax Credit worth 50% of the cost of the dental coverage you provide for your employees. To qualify, you must fulfill the following requirements:

  • Your California business must have less than 25 FTE staff
  • The average salary for your employees needs to be $56,000 or less
  • You must contribute 50% or more toward the dental insurance premium costs
  • SHOP coverage must be offered to all FTE employees

What Kind of Coverage Can You Expect With Dental Insurance?

All dental plans differ from insurer to insurer. However, Covered California dictates standard benefits that all insurers must adhere to. This includes:

  • Preventative care such as sealants, cleaning, and plaque removal.
  • Diagnostic exams and X-rays
  • Comprehensive dental treatments like root canals, crowns, and fillings

Take note that diagnostic and preventive services aren’t subject to a deductible.

Who Are Covered California?

You’re likely wondering who – or what – Covered California is. It is a government program that offers subsidized healthcare plans for the state of California. They generally carry the lowest prices and is easy to enroll in.

The plans are available for families and individuals and also small businesses so long as they meet the following criteria:

  • You must have at least one W-2 employee
  • Your employees cannot exceed 100
  • A high percentage of your employees must be California residents

How to Get Help Setting Up Dental Insurance For Your California Business

Employee benefits can be complex to deal with and set up. Even finding the best value insurance can take up a large amount of time. Never mind the ongoing administration once you have the program up and running.

If you’re not an expert in such matters, it can leave you tearing your hair out with the amount of time and effort it involves.

A great solution is to enlist the services of an employee benefits specialist. The good news is that you don’t have to commit to hiring one full-time. Instead, you can hire a virtual HR professional to deal with it all.

Finvisor For Your Virtual Benefits Assistance

At Finvisor, we’re the experts in providing professionals for all financial and HR aspects of your business. We know that most small to medium businesses can’t invest in full-time staff for these roles, so we provide them on a “needs” basis. What this means is that you only pay for the services that you need. As you scale your business, you can scale the amount of service you get from Finvisor.

Our virtual benefits experts are second to none. They will help you design and implement a winning benefits package to attract and retain the best staff. They also know where to find the highest value dental insurance at the most attractive price.

If you also need help with payroll and other HR functions, your Finvisor expert will be on hand. Get in touch to find out more.


All businesses need to be offering decent benefits just to stay in the game. It’s a job seekers market out there. Remember that Great Resignation? Well, it’s still going on, so you need to make sure it doesn’t happen in your business. Keep your staff happy, and the rest will follow.

To learn more about what we do, or to request a quote, contact us at or 415-416-6682. We’re here to help you navigate deferred revenue journal entries so you can make the most of your assets!

*This blog does not constitute solicitation or provision of legal advice and does not establish an attorney-client relationship. This blog should not be used as a substitute for obtaining legal advice from an attorney licensed or authorized to practice in your jurisdiction.*



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