For brokers to survive, they need to make their value manifest — and one way of doing that is through technology, Alan Katz, a former National Association of Health Underwriters president, said Monday during a session at NAHU’s annual conference in Albuquerque, N.M.
There has been an explosion in the last few years of tech startups serving the benefits industry. These companies, such as Zenefits and Namely, are not unfair competition or “even all that innovative,” said Katz, principal at Los Angeles-based consultancy The Alan Katz Group. Rather, they created an unlevel playing field for advisers.
“There is nothing wrong with people innovating the market,” Katz said. An adviser’s job “is to recognize it and do something about it. Competition is never bad, unless you ignore competition and if you ignore competition it is very, very bad.”
In the past, advisers assumed clients knew what the adviser’s value was, “but unperceived value does not exist,” Katz said. “Being a sales professional is no longer enough.”
“We need customers to acknowledge the value we are bringing and the days of free service are over,” he added.
Advisers can make their value manifest through technology. “Successful brokers leverage … technology to amplify high-touch value to better service clients, fend off competitors and demonstrate their value,” Katz said.
Advisers have no choice and must go digital because clients are demanding it, competitors are making it necessary and the Affordable Care Act compels it, Katz said. “It is sort of a perfect storm,” he explained.
Clients are demanding technology because employers are increasingly doing business online. He pointed to a survey that found more than half of the customers of office supply store Staples are buying from Staples.com. “When customers are buying staples online, I guarantee they want to talk about health insurance online,” Katz said.
Organizations large and small are using technology to take business away from brokers who are not offering online capabilities, he added.
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