Being in the right place at the right time can sometimes make the difference between success and failure.
As you will see below, in todays insurance business, the right place to be is in worksite marketing. And the right time is now.
The timing has never been better to enter the lucrative field of worksite marketing or, as I will refer to it from now on, voluntary employee benefits. But is selling voluntary employee benefits right for you? Here are some issues to consider if youre contemplating a move to this niche.
Do you have a significant customer base in the corporate market?
If yes, then youve already overcome the toughest obstacle youll encounter when entering a new market. Youve probably already sold a combination of financial products to your corporate clients. Now, selling voluntary products is a logical extension. Its also an excellent way to maintain your customer base while finding new ways to generate revenue.
Are you concerned about competition gaining a foothold in your customer base?
If youre not, perhaps you should be. These days, employers are looking for total account development–someone who can attend to all of their employees insurance needs.
In addition to the more obvious sources of competition, take into account your customers bank, payroll vendor, pension specialist or even a dot-com company. Each of these potential competitors will someday look to expand their product offerings in direct competition to your business.
The ability to sell several lines of business gives you a definite advantage in your clients eyes. And wouldnt you rather have your client receive this value-added service from you than one of those other potential competitors?
Are your corporate clients concerned about the rising cost of providing employee benefits?
Who isnt, right? As the cost of basic benefits continues to rise and profit margins tighten, offering a competitive benefits package to employees can become cost-prohibitive. However, businesses still need to assemble a good benefits package to attract and keep good employees.
Like most employers, your customers are probably looking for a competitive package that wont increase corporate expenses. Products offered through a worksite program meet this need. They enable you to present a wide array of competitive benefits without additional cost to the employer.
Is the industry paying enough compensation for producers to make a living at worksite sales?
Assuming you already have an established customer base, worksite marketing can be highly profitable. The compensation scale is comparable to individual insurance products–for example, 85% to 90% commission for universal life. A case of 100 employees will generate upwards of $10,000 of commission (typically split with an employee benefits specialist) for just a universal life product offering alone.
If you have decided that the time is right for you to tackle worksite marketing, a good place to begin is by doing some research (For example, with LIMRA International, Windsor, Conn., or with an independent consulting firm). Then consider how best to approach the market.
You can try to learn all the nuances of this market on your own. Or you can partner with an employee benefits specialist and an established third-party administrator that handles enrollment and administrative tasks.
However you start, the point is, now is the right time for worksite marketing. Your job is to be in the right place at the right time.
James T. Pettapiece, CLU, is president of Vision Financial Corporation, Derry, N.H., and former president of the Mass Marketing Insurance Institute. He can be e-mailed at email@example.com.
Reproduced from National Underwriter Life & Health/Financial Services Edition, June 29, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.