Utah prides itself as being friendly to small businesses and celebrates its rising tech sector. Yet, Utah wants to shut down Zenefits, an online competitor to traditional health insurance brokers.

This decision means that Utah will be the only state in the nation where small businesses are unable to purchase health insurance or manage their payroll, hiring, and other benefits through Zenefits' free, online platform.

Why is this happening? Some traditional health insurance brokers – the kind who still insist on using paper print-outs and fax machines to manage policies – complained that Zenefits' online service is unfair competition because it is too easy for employers to get up and running with insurance through the service – and that’s unfair to other brokers that aren’t offering a similar service. Seriously.

Traditional insurance brokers across the country have been coming under pressure from Zenefits, and have been losing clients to us as small businesses find it easier to handle benefits online instead of via the fax machine. And Utah Insurance Commissioner Todd Kiser — himself a former insurance broker — is undoubtedly hearing from his former colleagues in Utah as well.

There is nothing unfair about this: if small businesses in Utah want to choose Zenefits, let them. There's nothing stopping insurance brokers from building great software to compete against us — it's just that they haven't done so, yet.

What‘s unfair is withholding a service for Utah businesses that is free in 49 other states – just to protect an incumbent industry.

And this decision runs counter to our country’s – and, in particular, the state of Utah’s – principles of free-market competition, innovation, and entrepreneurship. If Utah is going to be welcoming to technology and innovation, it cannot simultaneously allow incumbents to use the power of regulation to protect themselves. Utah’s regulators aren’t stepping in to protect consumers; they are intervening to protect incumbent businesses from competition, as regulators across the country have done with Uber and Lyft, Airbnb, Tesla, and now Zenefits.

If you agree that innovation and competition should be allowed to flourish, and that Zenefits should not be shut down in Utah, then please sign our petition! Tell Utah Governor Herbert to stand up for innovation and online competition!

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