While voluntary/worksite benefits have been around for years — I started getting my feet wet in 1986 — the number of choices in carriers and plans has grown dramatically. There's more demand, more choices and more responsibilities. Here are some simple tips for brokers: the dos, don'ts and things to remember.
1. Do team up —
If you are not a broker familiar with the complexities of the voluntary/worksite market
, consider teaming up with a specialist — preferably not a captive or semi-captive who represents one carrier.
2. Don't offer too much to soon —
It takes time for the employees and employers to understand the process and the value of the plans, programs or services.
3. Don't assume employees know what they want, need, or can afford —
Surveys only work if the employee already understands the value of the plans for themselves and their families. Select plans that have worked with employees in similar industries, income brackets and demographics
4. Remember, the value of the plans offered extends beyond the individual employee to their families —
Family members should be included in the decision making process.
5. Don't confine the employer, employees and yourself to one carrier —
No single carrier has the best of all plans, programs and services. The number of carriers of plans, programs and services — insurance and non-insurance based — has grown dramatically in the past several years. Carefully select plans to meet the needs of the employer, employees and their families. Check for price stability, guaranteed or simplified issue, and portability.
6. Consider first how to provide employee education, communication and enrollment —
In addition, the data generated by the plans, programs and services will need to be sorted and distributed to carriers, TPAs, payroll, etc.
7. Do help the employer and employees save money —
Include tax advantaged plans in your strategy. They save the employers and employees money and are appreciated by participants. These include: Section 125 (premium conversion, POP plans); flexible spending accounts (medical reimbursement plans); dependent care reimbursement accounts (dependents young and old); and public/parking transportation reimbursement accounts.
8. Don't forget to integrate plans —
Make sure the voluntary/worksite plans
integrate with the traditional core benefit plans. The employees must understand what is and is not covered and their contributions to the existing plans, programs and services.
9. The management team and department heads must buy in to the strategy and understand the value of the plans, programs and services offered to their employees and the families —
Have separate meetings with them first. Ask for their help. During the enrollment period, have pulse meetings to handle problems, complaints and to get recommendations.
10. Do determine in advance the method of enrollment —
There are a number of methods for enrollment available and these can be used jointly. They include: one-on-one/face -to-face; Internet based; call center; and paper forms. When using a carrier for the enrollment, closely monitor that they are properly representing all plans offered to the employees. Spot check for overselling and pressure to buy.
11. Do determine who will pay for the enrollment —
Compensating for the enrollment should be determined early in the plan selection process. Commission splits and/or fees may be involved. It's best to be transparent with the employer.
12. The success or failure of the voluntary/worksite plans and strategy will ultimately be measured by two statistics:
1) Penetration — How many employees participate in a given plan, program or service.
2) Persistency — How many years employees remain on plans, programs and services in which they are enrolled. These stats will determine the quality and effectiveness of the education process, employee satisfaction, carrier profitability, broker income and whether or not the employer is satisfied and expands on the voluntary/worksite plan in future years.