To be successful in the sale of voluntary insurance products the agent will have to be transformed into a member of the business owner's employee benefit advisory team.
As a member of the business owner's advisory team, the voluntary benefit professional (VBP) will have to become educated in COBRA, HIPAA, Hi-Tech and the implications of the Patient Protection and Affordable Care Act. The VBP will also have to gain a stronger understanding of the various business objectives of the business owner as well as the challenges that he or she faces today. Most importantly, the VBP will have to abandon the old style approach of offering every product in the portfolio to employees in search of making a sale to every employee.
The old portfolio approach was less about either the employee or the employer and more about the insurance agent's sales commission. The truth is that there is simply not enough time in the face-to-face meetings with employees to either help identify needs or to insure that the employee understands what he is buying. I have been in companies where the employer provided an employer-paid dental plan and the voluntary agent also sold employees his dental plan. The only person to benefit in this scenario was the agent.
To move from a worksite marketer to a voluntary benefit professional, the insurance agent of the 21st century will have to begin by identifying what benefits are currently being offered, what the employer's objectives are and how effective has the employer been in achieving those objectives. Here is an example of the type of conversation a VBP might have with an employer:
VBP: So, can you tell me what benefits you currently provide?
Owner: Sure. I provide my employees with a group health plan and group term life.
VBP: And how much do you pay of the premium for employees and dependents?
Owner: I pay 100% of the employee coverage and the employee pays for dependents.
VBP: What strategies have you used to deal with the increasing premiums?
Owner: We have had to raise deductibles and out-of-pocket costs in order to keep to premiums affordable.
VBP: How has that affected employees?
Owner: They are not happy!
VBP: Was having a positive impact on employee morale one of your goals for offering benefits?
Owner: Yeah, but that is not working so well these days.
VBP: So, if I can show an inexpensive voluntary benefit that can help the employees offset the increased out-of-pocket exposure and simultaneously have a positive impact on morale would you be open to looking at it?
In this exchange the VBP has identified a very real goal that he can help the business owner achieve through numerous voluntary products such as a medical gap product or my personal favorite, a true voluntary critical illness product.
Strategic approach
Once you choose the one or two products that will help the employer achieve his or her goals it is time to schedule the enrollment. The best approach is to begin with group informational meetings. This allows the VBP to fully explain the products being offered and link them to the employer's objectives.
In the case of a true group voluntary critical illness product I might explain the covered conditions and link those benefits to filling the out-of-pocket financial exposure. Additionally, I would discuss the fact that because the employer really cares about the employees he has sought out a very affordable solution.
In doing this I have a twofold objective: visibly help the employer manage employee morale and insure that employees have a strong understanding of the critical illness product. The enrollment will follow the next day with employees choosing to either participate or sign a waiver of participation. This approach assures that there will be no employees dropping coverage immediately following the first deduction, which makes my employer client extremely happy.
There are other advantages to limiting the enrollment to no more than two products. You will experience much higher participation because you will be able to focus your time on explaining the benefits of your product offering. This will result in employee appreciation of the benefits as well as a more complete understanding of the products. In subsequent years the VBP can add products.
I recommend that the VBP never add more than one additional product per enrollment. During that enrollment, focus the group meeting on explaining the new product in depth and briefly mention the prior year's offering. With each successive enrollment the VBP should rotate the emphasis, never stressing more than one product. While a single product focus will not generate as much premium during the initial enrollment, over time you will generate significantly more revenue.
Historically the insurance agent selling voluntary insurance products has been seen not as a professional but as a product peddler. It is this perception that has kept the agent selling core benefits from including agents selling voluntary products in his team of advisers. The typical approach of "load the wagon and the horse will pull it" has to be replaced with a more professional approach to product choice and enrollment strategy. For the insurance agent who understands the real value of voluntary benefits in helping the employer achieve his benefit objectives, there has never been a better time to be in this market. I know without any doubt that the voluntary benefit professional is in the best position to make a real difference in the lives of working Americans than any other insurance professional. And he can make more money with less effort as well.
Reach Schlesinger, RHU, REBC, at
