What do brokers want from a voluntary benefits carrier? Pt. 3

By Brian Summers

Colonial Life


For the first two parts of this article, I spoke with representatives of Colonial Voluntary Benefits, Mutual of Omaha and Allstate Workplace Division. Now that we know what the carriers believe, it's time to find out what brokers want from a voluntary benefits carrier.

First off, I want to thank David Lyons, President of the Clayton York Group, Doug Hickey, Managing Director of Hagedorn and Company, Joe Cavallaro, President, Century Enrollment & Benefit Services and Todd Rashkin, Vice President of BenefitsSupermarket.com for taking the time to answer my questions.

To be fair, for this article, I wanted to choose a variety of brokers. I did not want to interview a bunch of brokers I have worked with in the past. Of the four gentlemen interviewed, I have personally only worked on one of their cases. One of these brokers I have never met before.

I asked each of these gentlemen seven questions. For part three, we will focus on the first three questions:
    1.) Do you feel that voluntary benefits are a value to your clients?

    2.) Do you feel that voluntary benefits carriers are properly communicating the products and services they offer?

    3.) Do you offer voluntary benefits to your clients because:
      a. Your client asked for it?
      b. You're a voluntary benefit representative?
      c. You are actively marketing voluntary benefits?

    4.) If you have stopped working with a voluntary carrier in the past, what was the reason? Examples: Your rep left, invoicing issues, service from the carrier, service from the rep. Please do not list the name of the carrier in your response.
Not surprisingly, the questions to number one were quite similar. "Absolutely," is how Lyons, responded. "Voluntary benefits are a great value to our clients who want to keep employees happy with a wider range of coverage," was the response from Rashkin. Meanwhile, Hickey decided to take the question one step further: "Given the economic conditions many employers find themselves in, it has become extremely difficult to find the resources to fund additional benefit programs for their employees. Voluntary programs offer employers an excellent vehicle to bolster their plan offerings while operating within their budget parameters."

All four brokers agreed that voluntary benefits are a value to their client. While I did not expect their answers to be negative, I was surprised at the explanations that Rashkin and Hickey provided.

The answers to question two may be surprising to voluntary carriers. It is evident in the first two parts of this series, that carriers believe they are communicating their products and services to the broker community.

"It really depends on the carrier, some do a quality job communicating, other's do not. I would like to see more simplified product descriptions so that employees can quickly and easily understand all aspects of their coverage and more importantly, how to properly access and use their benefits," said Rashkin.

Lyons responded, "Yes, but somewhat. They have good brand awareness, but the enrollers are really offering the one-on-one presentation needed." Meanwhile, Hickey feels that the carriers are getting better at communicating their products and services to the broker community. "There is still a fair amount of inconsistency in communicating programs to the buying community. Some carriers are providing too much information which can bog down the process." He suggests that material should be streamlined and to the point. "A carrier needs to be able to make their point without putting the client to sleep."

Only Cavallaro answered "yes" to question number two.

Before their responses, I felt that many of the carriers were communicating their products and services to the broker community fairly well. Information available online and through Webinars and voluntary reps should add up to more communication to the broker community.

As voluntary benefits become a larger part of an employee's package, it's more important than ever that the representatives of each company know the products and services they are offering -- inside and out. New reps or veteran reps who do not understand the needs of brokers and their clients are a recipe for disaster. A good broker developer for the carrier should be able to explain the products and services accurately and get straight to the point.

Developing simple marketing materials that do not need to be explained to the brokers should be an essential part of any voluntary company's future plans. In the past, I have heard these complaints from brokers: The underwriting is too complicated; I can't understand the compensation plan; you're giving us too much information. The bottom line is that reps who successfully work with brokers understand this problem and do everything they can to give brokers a quick overview and get straight to the point. Successful reps understand that developing a partnership with the broker is crucial. They do not overload the broker with marketing information, and they do not expect to sit down with a broker for hours and train them. Successful reps are able to answer a brokers question quickly and continue to educate brokers about their products and services through a mutually respectful relationship.

A rep setting an appointment with a broker, coming in with a marketing item and giving the broker a ton of information at the first meeting is wasting his time, as well as that of the broker. If this is how the rep prepares for the meeting, the broker knows that this is how that rep will present the benefits to their clients and employees. "Keep it simple, talk less and listen more" should be the motto of any good broker developer.

Voluntary representatives and carriers want to believe that brokers are actively marketing voluntary benefits to their clients. That is the question all four brokers were asked. I broke this question down into three separate categories:
    a. You offer voluntary benefits because your clients asked for the product.

    b. You are a voluntary benefit representative.

    c. You are actively marketing voluntary benefits.
"Our firm has evolved point A to point C within the past two years," said Hickey. He further explained that his company has become more proactive in marketing these programs to customers and prospects before they ask. "Two years ago, I would say that was not the case," Hickey said. It was based on client request more than our taking the initiative. I would say that having a knowledgeable representative has certainly made this transition easier for our firm. Being able to cut to the heart of the matter in terms of benefits to both employee and employer can be advanced through a good working relationship with a voluntary carrier rep. We found that to be the case with one of our voluntary representative."

"Rarely," is how Cavallaro responded to question 3A. "Never" was his response to question 3B. Instead, Cavallaro markets voluntary benefits "... primarily through educating my clients and prospects on the value of voluntary benefits and how they serve to fill in gaps in their existing plans coverage."

Rashkin's response to 3B was, "The voluntary rep plays a significant role for us, whether assisting with enrollment or just keeping their companies' products fresh in our minds. It is essential to know the entire marketplace, so that we are able to tailor the right plans for our clients. While we are actively marketing for group medical, we are not marketing for voluntary benefits. We see voluntary as more of a packaged sale with medical."

So, what we have learned? We have learned that all four brokers find that voluntary benefits are a value to their clients. We have learned that, while voluntary carriers may feel that they are marketing their products and services to brokers in a very efficient and accurate manner, the brokers interviewed feel that the carriers could do a better job of marketing by making voluntary benefits easier to understand.

More importantly, we have learned that while the voluntary benefit representative is not a reason to offer benefits for one broker, two brokers feel that the voluntary representative is a vital part of the marketing and enrollment process.

The questions are then summed up by one simple and direct response: "Like most things related to insurance, most of the time it is sold not bought," is how Lyons responded to question three.

Sometimes we forget to just sell! Only through properly educating employers and employees on the benefits of voluntary products can we sell successfully.

If you are not offering voluntary benefits to your current clients, my question to you is simply, "Why?"

Five years ago, voluntary benefits remained on the backburner of many brokers concerns. As the economic climate changes, it has become increasingly more important to consider offering voluntary products.

When deciding on a carrier or representative, you need to consider the following:
  • Are you providing your clients with needed insurance offerings?

  • Can you provide your clients with valuable benefits communication through voluntary benefits?

  • Are you protecting your business by offering voluntary benefits?

  • Are you working with a voluntary partner you can count on?
As the broker of record on an account, you should be the one deciding who presents voluntary benefits to your clients. If the carrier or representative does not meet your standards, then work with someone else. You want to work with a carrier and their representatives who bring quality products, quality service and value.

In Part four of this series, I will share the remaining answers with everyone, and I'm sure many of you want to know why these four brokers have stopped working with voluntary carriers in the past.

*For further information, or to contact this author, please leave a comment and your e-mail address in the forum below.