What Does Agent of Record Mean?
An AOR, or Agent of Record, is an organization or person who can perform certain HR- HR-historic and enrollment-related (insurance) functions on a company’s behalf, including acting as the employer’s authorized representative. In Human Resources, an AOR is responsible for administering employee benefits programs or insurance policies.
Purpose of an AOR
The AOR acts as a central point of contact between the organisation and external parties.
Objectives include:
- Easier management – No need to make multiple benefit/insurance administrations.
- Expert’s advice – Use the AOR expert’s knowledge for better vendor terms.
- Employee Help – Helps employees understand and access benefits.
Key Benefits
- Efficient – Lightens the load on HR teams.
- Savings – Leverages lower negotiated rates with insurance or benefits brokers.
- Compliance – Guarantees compliance with laws and regulations.
Best Practices
- Choose practiced AORs – Opt for employees who have HR or insurance experience.
- Manage scope with clarity — Use an AOR letter format to define responsibilities.
- Routine audits — Review AOR performance to ensure it is meeting our company’s needs.
Common Challenges and Solutions
- Misaligned priorities: Align AOR goals with company objectives by clear contracting.
- Communication lapses – Regular check-ins to remain in the know.
- Cost considerations – Compare the AOR fee to benefits and make sure that it makes sense.
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