Benefit firms want to leverage the opportunity around worksite voluntary benefits, but the results for most are, well, pathetic: Few, if any, cases sold and underperforming enrollments that produce disappointing commission revenue. Most brokers struggle, and usually fail, to cross-sell voluntary. Eastbridge Consulting reports that almost half of all WVB premium sold in 2012 was merely from takeovers of existing business, not sales into virgin accounts.
I've written extensively that benefits firms need a strong WVB practice to succeed post-reform. Consider that a well-run voluntary case can generate first-year net revenue of $56 per eligible employee, after enrollment expenses. The secret to success is an intentional, comprehensive WVB practice that is integrated into your firm.
Five steps to build an effective practice
1) Integrate WVB into your benefit firm's broader value proposition and sales process - don't treat WVB as an afterthought. Use the voluntary toolbox to solve problems, either with the health plan or other HR pain points. WVB and the ancillary services of the voluntary enrollment are valuable tools that solve pressing HR problems, usually with zero impact on the client's budget. One of our benefits agency clients is generating almost half of his top-line revenue from WVB.
2) Analyze your book to identify the highest-value prospects for WVB - don't set yourself up for failure. Not all WVB prospects are created equal; factors such as group size, industry, employee demographics, benefit plan design, and enrollment conditions can impact WVB success. Target your ideal accounts to maximize results.
3) Cross-sell WVB with a consultative approach - don't push product. Consultative selling is the key to selling WVB successfully to the employer. While brokers and agencies talk of becoming more consultative, few are. Our clients are learning consultative skills by selling voluntary the right way and closing WVB cases.
4) Develop effective enrollment strategies for small and large groups - don't let a case die on the vine or cost you the AOR. A WVB case isn't sold until it's enrolled; a bad enrollment will generate poor revenue and can damage your client relationship. WVB enrollments have lots of moving parts, so implement a comprehensive case management process for all WVB cases. Find a carrier with small-group enrollment capabilities or, for best results and maximum control, build an effective internal enrollment capability for small groups, including an online self-service enrollment system with an avatar virtual benefit counselor. Partner with a professional enrollment firm to handle larger groups and provide specialized services.
5) Select the right carrier partners to match your clients' needs - don't assume all WVB carriers are the same. The enrollment is for days or weeks. Claims and billing are forever - and WVB billing is a complex process. Your carrier partner determines the long-term success of your WVB case. To avoid unnecessary headaches, make certain you're partnering with a carrier that can support your client - and your success.
Since all this requires a lot of specialized knowledge, you should consider partnering with a qualified enrollment firm or third-party consultant to help you achieve maximum revenue on your accounts. Regardless, create a well-designed and integrated voluntary benefits practice to ensure your success with WVB.
Griswold is an agency growth consultant and author of DO or DIE: Reinventing Your Benefits Agency for Post-Reform Success. His Agency Growth Mastermind Network helps agency leaders reform-proof their firm. Reach him at (615) 656-5974, nelson@InsuranceBottomLine.com, or through 21stCenturyAgency.com.
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