Benefits can play a crucially important role in achieving strategic business goals. Be that as it may, most employers are less than excited to shop around for an “ideal plan.” Insurance just isn’t met with the same level of excitement as other business decisions like capital investments, marketing campaigns and/or revenue-generating projects. But why is that exactly?
I suspect the lack of interest has little to do with the options available and everything to do with the way in which insurance is sold. The traditional sales process for insurance plans is an annoying means to a frustrating end (or more specifically speaking, an inferior product). The antiquated path to mediocre insurance looks something like this…
- An agent obtains access to an insurance product that promises to save money.
- The agent calls on as many employers as possible touting this “cost-saving” solution, requesting a copy of their current policy and employee census to illustrate savings.
- The agent returns two weeks later delivering a solution that is going to help the company so much…on a spreadsheet…with 5 other options…options that include the current plan.
- Because this process started 60 days before renewal, the agent frantically gathers all documents to set up the plan with the insurance carrier, and haphazardly explains the new plan to employees (if at all). They can deal with the complaints and questions about what the plan covers later.
Feeling wowed? Me neither. It’s no wonder that organizations put more thought into CRM software, their next equipment purchase or where to host the company holiday party.
The most tragic aspect of the traditional sales process is that insurance agents have been paid rather well for delivering very little service. It’s been this way forever… since the advent of Microsoft Excel. But isn’t it time to raise the bar? Shouldn’t insurance professionals be held to higher standard? Shouldn’t business owners approach insurance with the same level of scrutiny that they apply to other purchase decisions?
Brokers vs. Advisors: How to Break Up with Broker Style Service
An insurance broker or agent is a middleman who sells a product based on cost according to the traditional sales process outlined above. Insurance consultants or business advisors provide a more proactive level of ongoing support that is based upon intimate knowledge of your organization.
But can’t anyone call themselves an advisor? And aren’t some insurance agents more service oriented? Absolutely, and it can be difficult to tell what’s what. To ensure that your organization receives service and support that represents your interests, ask yourself a few questions.
Has my agent…
- Reviewed the costs associated with plan/program options?
- Reviewed service issues associated with the plan/program?
- Presented plan/program ROI projections?
- Discussed talent concerns (the ability to attract/retain talent and/or reduce employee turnover)?
- Discussed employee engagement or morale?
- Discussed goals for the future?
If you can’t answer all of those questions with a confident “yes,” it’s time to find a new advisor.
I have challenged myself to look beyond the short-term gain of selling insurance products that offer limited cost-savings. The change has not been easy. The pressures to sell, sell, sell is greater than ever as companies push for retention and market share, but it all comes back to this question…who am I working for? If I wanted to work on behalf of insurance carriers, the traditional approach is a fast-track ticket to high commissions, but I don’t think that model is sustainable.
The employment landscape is changing, and with more data than ever at our disposal to make better business decisions, it’s time to broaden insurance conversations to HR conversations.
Here’s what we know…
- The total cost of employee turnover equals 90-200% of annual compensation. (SHRM)
- $0.37 of every payroll dollar is lost due to poor employee engagement. (Gallup)
- The cost of a benefits program could be reduced by 20% with proper education. (McKinsey)
Ready to discuss benefits and other factors impacting the cost of human capital and the success of your HR strategies? Benefit Advisors of Charleston now offers HR support to enhance implementation and ongoing management of employee group plans.
Schedule a complimentary consultation to learn more about HR solutions that are available to BAC clients and our evolved approach to “selling insurance.”