Today’s employers are facing many types of benefits challenges, not the least of which is the rising costs of group health insurance. Whether from increased utilization or general trends in the market, employers are forced either to reduce benefits or pass these rising costs on to employees in the form of higher deductibles, coinsurance or co-payments.
At the same time, to compete in a tightening labor market, employers need to offer the best benefit package possible, with quality coverage that’s flexible enough to cover a variety of needs, all the while keeping the workload of an already understaffed human resources department at a minimum.
So, what’s a producer to do?
Critical illness opens doors
On your next sales call, ask the employer or HR manager, “Are you being forced to increase out-of-pocket costs or decrease benefits for your employees to manage your health care expenses?”
If the answer is yes, suggest compensating for those cutbacks with an employee-paid CI plan. This way, even if the employer has to reduce or eliminate benefits, he or she still can offer something in return–and at a discount to the employee.
To appreciate the value of a critical illness plan, you need only look at the economic impact that serious medical conditions have had in recent years on the consumer:
o About half of bankruptcies are attributed to medical causes, impacting about 1.9 million individuals (both filers and their dependents), according to MarketWatch.
o Among those whose illnesses led to bankruptcy, nearly 76% had medical insurance at the onset of illness.
These statistics represent Americans with health insurance; however, their coverage, on average, has serious gaps. That’s where the producer comes in.
CI insurance is a benefit designed specifically to help employees with the financial impact of a serious illness. It also gives financial control back to the employee, since CI is a lump-sum benefit the policyholder can use as he or she chooses.
What to look for
So, you have your foot in the door. Now what? Quality products, scale and experience in the worksite market are important in this environment, but employers aren’t just looking for solutions for their employees. They need solutions that make sense for them, as well.
Point out needs and suggest a solution before you begin discussing product features. The need should be focused on both the employer and the employee. For example, lead with some hard-hitting facts like the bankruptcy statistics listed above. Demonstrate gaps in coverage and the benefit of offering employees a solution without increasing employer costs. Now, you are ready to move to the product itself.
A carrier’s products must be priced attractively, easy to access and administer, and simple to communicate and enroll. Often, the best product for your client will not be the least expensive; instead, offer expansive features and choices, flexible underwriting and eligibility considerations, and provide a streamlined enrollment process.
Be prepared to ask the carrier several key questions, such as:
o Is the product designed as a group or individual contract? Most carriers offer only one or the other. Some offer both and, depending on the needs of your client, it’s important to understand the characteristics and relative advantages of each in order to offer the best solution. For example, individual contracts are portable, while group contracts may not be.
o Does the carrier offer additional options or riders to the base policy? Remember, employees have varying needs, and it’s important that the product offers alternative levels and features.
o Will most employees qualify for coverage? Flexible, streamlined underwriting will enhance participation and increase client satisfaction levels.
o How will the enrollment be conducted? Historically, face-to-face enrollment has proven to be effective. However, larger clients and clients with widespread employees may be more effectively enrolled via a call center or the Internet.
o Does the carrier have a proven track record in policy administration, service and billing? These elements are significant if the employer is to implement a successful, continuing program with minimal diversion of benefits and payroll resources.
Employers are looking for peace of mind as much as employees. Giving it to them builds your credibility and enables you to branch out to a new client base and expand services to your existing client base.