The recent broker compensation investigations may have given local and regional benefits brokers help in competing with the big, national brokers in the group disability insurance market.
That’s the picture that emerged here during sessions at the 13th annual disability insurance seminar organized by JHA, Portland, Maine.
Drew King, president of JHA, a disability risk management and consulting unit of General Re Corp., Stamford, Conn., started the seminar by putting distribution–especially distribution aimed at employers with fewer than 100 covered employees–on his list of top 10 predictions for 2006.
Instead of focusing solely on sales, “we’re going to start talking about how good was the business that we wrote,” King said.
JHA executives have been speaking for years about the importance of keeping carefully underwritten, properly priced group disability accounts on the books.
Disability insurance executives argue that rate comparisons can be misleading in the disability insurance market, because subtle differences in contracts can lead to wide variations in policy performance.
This year the biggest brokers seem to be looking mainly at price, especially for small and midsize employers, but smaller brokers seem to be more interested in using good service and new services to set themselves apart from competitors, according to Len Cavallaro, senior vice president of sales and marketing at Jefferson Pilot Financial, Greensboro, N.C., a unit of Jefferson-Pilot Corp.
Cavallaro, who spoke at a session on the effects of New York and California regulators’ investigations of broker compensation arrangements, noted that the investigations focused mainly on the biggest brokers.