Selling individual disability insurance to two or more employees at the same employer is less expensive than selling coverage to just one.
That fact has led to growth in the multi-life DI marketplace in recent years, and the trend is here to stay.
Voluntary multi-life DI is attractive because it helps employers maintain comprehensive employee benefit packages that can attract and retain employees while being budget-friendly. Employees can use multi-life DI programs to buy valuable coverage at a discount through a carrier their employer has endorsed–often with streamlined underwriting.
Producers who offer successful multi-life DI programs see increased referrals, increased cross-selling opportunities and more commissions.
To be successful with multi-life DI cases, you need to understand the customer and effectively communicate the offering.
Understanding The Customer
Employers are the gatekeepers to those ultimately purchasing the policies. When the producer has a strong relationship with them, employers can gain a deeper understanding of their own role and how their support makes the enrollment more successful. A strong relationship with employers also helps assure that participation requirements are met, that employees see the producer as a trusted resource, and that the employer gets a strong plan design, customized to employees’ needs.
When meeting with an employer about voluntary multi-life DI, ask these questions to get a deeper understanding of the employer’s workplace and objectives:
o What benefits do you currently offer employees? Do you pay for them or offer them on a voluntary basis? Do you offer group LTD insurance? If the employer answers yes, get details of the coverage (e.g., taxability, benefit caps, if base or incentive pay is covered, replacement percentages, and so on.).
o What percentage of employees earn more than $75,000 a year? Would you like to offer the program to all employees or to a select group (e.g. executives or highly compensated employees)?
o Can I meet with employees during work hours?
o How do you communicate with employees? Can we take advantage of those communication vehicles when promoting this offering?
o With whom do I work with in the company to ensure the plan design and participation requirements meet expectations and the enrollment process is supported?
Asking these questions helps position the producer as a resource for employee benefits. Plus, this knowledge is valuable when designing a plan that meets employer and employee needs.
Keep in mind that the best plan design is simple and straightforward. Avoid adding features that may confuse employees. When working with the carrier, make them aware of the potential size of the group as well as the degree of employer support that can be expected. These two factors help the carrier determine the details of the offer, such as the maximum benefit amount and discount percentage (often 20% to 30%, based on gender-neutral rates).
Finding Ways To Communicate
Putting benefit decisions in the hands of employees means more education and communication is needed. Most employers welcome assistance in helping employees understand the benefit offering. Lack of knowledge and appreciation of the benefits can undermine an employer’s initial reasons for offering the coverage–to attract and retain a motivated, loyal workforce.
The best way to educate employees and ensure a successful enrollment is to contact them in a variety of ways. You never know what vehicle or message will resonate with a specific employee.
Establishing A Plan
Creating a customized plan design and determining the best ways to communicate with employees takes time and coordination. It’s best to work with an insurance carrier that offers assistance, such as customizable communication templates, employee enrollment packets and enrollment help.
When planning for the enrollment, the producer should pay close attention to four main categories of activities.
1. Account setup-Confirm plan design and participation requirements, determine enrollment dates and effective date of coverage and obtain the final employee census.
2. Enrollment communication-Determine the communication vehicles and key messages that will be used, establish a communications timeline and determine who is responsible for ensuring it is followed.
3. Enrollment meetings-Hold individual or group meetings, distribute customized enrollment packets, take applications and conduct follow-up calls.
4. Policy delivery-Determine the best method for presenting policies and receiving payment.
Following these tips when selling and enrolling a voluntary multi-life DI program offers something for everyone: employees are protected in the event of a disabling illness or injury, employers are able to offer a stronger, and more attractive benefit package and producers benefit from having satisfied customers, multiple sales and new referrals.
Mark Kinback is assistant vice president-multi-life marketing at Principal Financial Group Inc., Des Moines, Iowa, and Mike Edwards is director of financial services at COPIC Financial Insurance Group Ltd., Denver.