There's been a lot of talk about voluntary benefits, and forgood reason. Brokers should be concerned about voluntary. Butthere’s also plenty of value if they approach the marketunderstanding the hurdles to overcome as well as theopportunities.

First, brokers should be aware the premium revenue dollarsinvolved in voluntary plans are much lower than medical planrevenues. At a quick glance, medical coverage is worth severalthousand dollars per employee, whereas voluntary plan premiums aretypically hundreds. Are these lower revenue dollars worthwhile?Yes, provided they result in good things for multipleaudiences.

For the employee, voluntary benefits provide financial securityfor workers and their families at a reasonable cost, leveraging theconvenience of access at the workplace and payroll deductionpremium processes. For the employer, their benefits offering isexpanded, and valuable protection is available. For the broker,their role is expanded in a new direction and their organizationhas an additional source of commission revenue.

But the voluntary product can be confusing because there are somany options, commission schedules and enrollment methods to beconsidered. Brokers should carefully select product providers thatfit the gaps in the employer’s benefit plans and employee needs. Ingeneral, commissions have a broader range in voluntary than inemployer-financed group plans (ranging from very low-level groupcommission rates to very high front-end whole life type rates). Ingeneral, the compensation plan selected by the broker should takeinto account the price point for employees, the scope of enrollmentexpenses, product needs, and so on.

Understand the importance of creating and installing a voluntaryplan. All too often brokers focus on products but not process, andthat’s when it’s likely that the plan will fall short ofexpectations. There are many resources available from carriers,enrollment communications companies and voluntary specialists tohelp create an effective plan. It’s also important that a voluntarycampaign is not a single enrollment event, it should be part of anongoing benefit management program.

Let’s consider two case studies. A food service specializing insports arenas presented the enrollment challenge of broadlydispersed employees (multiple locations in multiple states)compounded by a perception on the part of management that theirassociates didn’t need voluntary life insurance. Along with thebroker, we convinced the client to let us create an enrollmentcampaign using tools including pre-enrollment communications,personalized enrollment materials and bilingal enrollment sessions.The result was 47 percent participation, and best of all, theorganization’s benefit management team became believers involuntary.

The second is a grocery store chain with unsuccessful pastexperiences. We used our online system, plus a series of plannedcommunications to employees, accompanied by careful tracking ofenrollment results. The campaign included three products, and theresulting participation was 47 percent on voluntary term life, 45percent on voluntary short term disability and 36 percent onvoluntary long term disability. Total placed premium on each casewas well over $200,000.