Accident insurance products are expanding with additional coverage and richer benefit levels.
In the last year, carriers have started to expand previously limited coverage to include emergency care, hospitalizations, fractures and follow-up care, explains Jim Boyman, president of enterprise voluntary at Cigna in Hartford, Conn. Some are also adding enhanced benefits, such as travel coverage or gunshot protection.
The innovation is coming as a result of increased competition, with only so much carriers can do to make their accident plan stand out, says Doug Kreszl, vice president of business development at National Benefit Partners, a Paoli, Penn.-based independent marketing firm that conducts due diligence on voluntary products and brings them to brokers.
“[Carriers] are trying to say, ‘How can we enhance what we deliver and attract more people to buy an accident plan?’” Kreszl explains. “Not everyone is interested in the same benefit because everyone has a different lifestyle. If you throw in a [new coverage], someone who didn’t have accident insurance in the past may now buy it. There are extra benefits that can get a potential participant to say, ‘This is a good benefit for me.’”
“There continues to be an arms race to get the most stuff covered that you possibly can,” adds Elias Vogen, director of group insurance client relationships at Securian in Minneapolis.
With the increased coverage, the product has seen continual growth. In the past three years that Cigna has offered accident, the firm has doubled sales every year and continues to see that trajectory today, Boyman explains. Securian is also seeing its sales of the product double year-over-year.
In addition to the move to high-deductible plans leading to the growth, the other big trend is accident insurance enrollment being integrated with core benefits enrollment, Boyman says. “It is being viewed more as a traditional product and loaded onto a benefit enrollment platform,” he explains. “It is sequenced differently [and] the products are being seen as complementary to medical coverage, which helps provide that additional financial protection.”
The increased demand has led to some downward pressure on the product’s pricing and, in some cases, employers paying for the coverage, which was traditionally exclusively employee-paid. A handful of employers are paying for the project as they transition to a high deductible health plan, Boyman explains. Overall, Securian is seeing more employers requesting quotes for the product both as a voluntary and employer-paid offering.
Brokers play an integral part in determining how clients should offer accident coverage. “Every employer has an overall benefit strategy they are trying to achieve,” Vogen says. “The broker needs to identify what is available from the healthcare or voluntary side and what is available to help the employer provide” the right amount of coverage.
“The broker plays a really important role. Instead of saying, ‘Every employer needs accident insurance,’ [rather], ‘How does accident fit into the overall benefit strategy?’” he adds.