Penetrating the small case disability insurance market can be challenging.

The sheer size of the market is daunting, with nearly 6 million U.S. companies employing fewer than 100 workers, according to the U.S. Census Bureau.

This market is largely untapped, partly because small employers need as much, if not more, education about the need for disability insurance as larger employers and partly because selling in this market can raise unique considerations.

The challenges range from determining who to target–often a chief executive officer, a chief financial officer, or someone else not dedicated to making benefits decisions–to how to successfully influence and support that decision maker based on that individual’s business priorities and goals.

Small businesses are often perceived as focusing primarily on cost. However, working with a trusted partner is of paramount importance to the decision makers in this audience. A “one-size-fits-all” approach to reaching small businesses is likely to yield little success. Brokers, who conduct appropriate research, develop a customized sales approach based on their clients’ needs, and prove themselves to be reliable and seasoned experts, will be much better positioned for success in the small case market.

Identify the decision maker

Small companies–those that fall into the fewer-than-100-employees category–often have a flat decision-making structure.

Typically, larger businesses have a dedicated HR function that coordinates benefits administration. This is likely not the case within a small business. In fact, individuals charged with making benefits decisions at smaller organizations may be more focused on day-to-day transactional work, particularly if those individuals are CEOs or CFOs. These individuals will be more concerned about new business, daily operations and, of course, serving their clients, and they may be more difficult to reach than executives in mid-level HR roles.

Reach your audience.

Decision makers at small companies are balancing numerous responsibilities. On the one hand, they need to pay close attention to their income and cash flow statements. They must carefully watch pennies. On the other hand, they are more likely to perceive their staff as somewhat of an extended family. Taking care of their employees is important for most small business owners.

To form successful, lasting relationships with small businesses, brokers need to develop creative solutions that are designed to help them reconcile their generous instincts with their budgets. Voluntary group disability insurance (with premiums paid solely by employees) and contributory programs (with costs shared by employees and employers) are two options that should be considered as potential solutions to help decision makers achieve peace of mind and address concerns about cost.

Voluntary group disability insurance gives small businesses the ability to offer a valuable benefit to employees without hurting the company’s bottom line. Also, voluntary group disability insurance is usually priced at a group rate, often at a fraction of the cost of individual coverage, thereby offering employees a discount not typically available to purchasers of individual disability insurance policies.

Contributory models allow employers to offer this valuable benefit while sharing the cost of the disability premium with their employees.

By providing knowledge, expertise and tailored solutions to decision makers in the small case market, brokers will earn the trust and respect of the small business owners and executives and be in a stronger position to influence the relationship and future disability coverage decisions.

Let the facts do the talking

Large companies are affected when an employee is injured or sick, but they are better positioned than their smaller counterparts to absorb the productivity losses and continue operations. At a small business, the loss of one employee for even a short period can lead to huge problems.

By offering disability insurance, small businesses may be able to benefit from disability carrier programs that help accelerate employees’ return to work.

Return-to-work programs can help workers return to their jobs more quickly by:

o Educating the employee about the disability itself.

o Setting appropriate expectations for a return-to-work plan.

o Helping arrange the kinds of job accommodations critical to complying with Americans with Disabilities Act regulations.

o Providing financial relief by absorbing some or all of the cost associated with worksite modifications.

o Reducing the expense associated with temporary help hired to fill in for the disabled employee.

Once decision makers understand the need for disability insurance, brokers should leverage that understanding. They should work to solidify their role as solution providers and also to establish themselves as trusted advisors. To accomplish this, brokers may want to consider:

Conducting a cost-benefit analysis for the employer using different disability coverage models, including:

–Dollars spent for the various disability funding options (voluntary, contributory and employer-paid).

–Employee education and training needs.

–Enrollment meeting demands.

–Administration costs such as payroll reporting.

–New-hire and termination notification processes.

–Creating and updating census information.

Educating small business benefits decision makers about return-to-work services, by:

–Teaching the decision maker how to maintain a professional distance from sensitive employee-relations matters.

–Counseling the decision maker about disability fraud.

–Providing value-added services, such as total compensation statements.

–Offering to handle enrollment for all insurance products.

–Remaining flexible and easy to work with.

To achieve an exceptional level of service, brokers will need to form a strategic partnership with a quality disability carrier that can support the brokers’ efforts, and particularly with employee education.

When working with small companies, there are several additional considerations that bear noting.

People at small companies are typically more invested in each other’s lives outside of work than at larger organizations, and that can lead to sensitive situations with respect to employee privacy matters.

If there is not a disability insurance plan in place, it is reasonable to expect that several people will be privy to information that should be regarded as private. When employees are covered by disability insurance, they don’t have to worry about sensitive information being shared with a co-worker, because the insurance company will manage communications with the disabled employee.

Another obvious benefit is the fact that disability insurance also covers a significant portion of a disabled employee’s salary, helping to protect the employee’s standard of living.

Finally, carrying disability insurance relieves the business owner from the burden of deciding which employee salaries will be covered, thereby mitigating the risk of discrimination issues.

Help the company help you

If brokers form solid relationships with benefits administration contacts at small companies–individuals whose titles can range from HR coordinator to finance manager–the brokers can help those contacts explain the need for disability insurance to the ultimate decision makers, if the contacts themselves are not the ultimate decision makers.

If, for example, the ultimate decision maker at a company is the CFO, the broker can prepare the internal contact to discuss the financials or present a cost-benefit analysis to the CFO.

If the ultimate decision maker is the CEO, the broker can assist in the creation of an in-depth business case for bringing a disability offering to the organization.

HR professionals are very selective when choosing benefits advisors–and they place great trust in the individuals they choose. It stands to reason that a recommendation from a trusted advisor to include a disability insurance offering will carry significant weight. If brokers do their research, offer value-added services and understand the needs of potential clients, they will become an invaluable resource and be able to establish successful relationships in the small case market.

Amy P. Thompson is the human resources officer at Disability RMS, Westbrook, Maine. She can be reached at