There has been much interest in voluntarybenefits and much speculation about how health care reform willchange the way brokers approach the benefits market. But what'sreally happened? Have any of the suggested changes beenimplemented? Eastbridge Consulting Group and Benefits Selling gottogether to find some answers to these questions by asking thebrokers themselves.

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One finding was particularly obvious—the majority of brokers nowsell voluntary, at least occasionally. Just 11 percent of thesurvey respondents don't sell voluntary at all and more than 60percent of those who don't sell it already fully expect to do so inthe near future.

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Top Voluntary Products Sold

Product

Benefit Brokers

Short-term disability

60%

Term life insurance

54%

Dental insurance

45%

Critical illness insurance

38%

Accident insurance (personal injury not AD&D)

36%

Vision insurance (without medical)

33%

Cancer insurance

25%

Long-term disability insurance

21%

 

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It's clear from the responses that health care reform hasinfluenced broker behavior. About half (53 percent) said theyalready sell more voluntary today because of reform, with 15percent saying they're selling significantly more. In addition tothose already selling more, another 32 percent expect voluntary toaccount for a larger portion of their sales in the future.

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The changes in the voluntary products soldmost often by benefit brokers were more subtle. As seen in pastsurveys, brokers most often sell voluntary versions of thetraditional group products—dental, term life and short-termdisability. But some very interesting additions show up on thelist. Critical illness and accident (personal injury accident, notAD&D) are both sold more now by benefit brokers than everbefore. We know from conversations with brokers and carriers thatboth products remain well-positioned to help employees coverout-of-pocket expenses due to higher deductibles and co-pays ontheir health plans.

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The following chart shows the other products listed as a topvoluntary product by 20 percent or more of brokers. 

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Brokers also are looking to enhance their product portfolio withother “non-traditional” voluntary benefits. Wellness programs arethe most popular benefit but discount health plans, legal plans andID theft coverage also are gaining more traction.

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Non-Traditional Products Sold

ProductBenefit Brokers
Wellness programs73%
Discount health programs38%
Legal plans31%
ID theft coverage29%
Pet insurance16%
Computer, appliance, furniturepurchase programs8%
Vacation programs5%

 

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We also explored whether brokers lean toward a single-carrier ora multi-carrier offering when choosing voluntary products andcarriers for their clients. A large majority (75 percent) said theychoose the best products regardless of the number of carriers inthe market. That's a significant increase compared to thepercentage reported in another survey completed a few years ago.Then, just 47 percent said they do this.

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Seventeen percent of brokers use the same carrier for allvoluntary products to simplify issue, billing and servicing. Thiswas down from 28 percent in the prior survey. Eight percent selectone carrier so they have access to bundled discounts.

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That's a significant decrease from the 22 percent in the laststudy. It likely has little to do with health care reform directly,but instead reflects the fact that brokers are getting moreexperienced and comfortable with voluntary, are treating theseproducts more like their traditional lines, and are selecting “bestof breed” products.

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Areas for Improvement by Enrollment Companies or CarrierEnrollers

ResponsePercent
Treat me like the customer11%
Provide me better service16%
Lower the price/cost of theirservice16%
Improve enroller quality28%
Offer better, different, or moreproducts16%
Be more flexible about theirprocess14%


The desire for high product quality alsowas reflected in the reasons why brokers use a specific carriermost often. Almost half (45 percent) said it's because of thecarrier's quality product, while 26 percent said it was because ofthe relationship they have with the carrier's sales rep or staff.The following chart shows all reasons given by those surveyed.

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[Note: Brokers could only choose one response (the one they feltis most important).] 

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When asked how many different voluntary carriers their agencyhas worked with in the last year, the majority said between two andfive carriers. These results are very similar to those in a 2010study of brokers.

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When asked if they expect the number of carriers used to changein the next two to three years, more than half (59 percent) see itincreasing and 14 percent believe the increase will be significant.About one-third said they don't expect any change and 7 percentexpect the number to decrease.

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Enrollment

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Those who use an enrollment company or carrier enrollers wereasked how satisfied they are with the company's performance.Forty-six percent said they are “extremely” or “very” satisfied.Another 41 percent said “satisfied” and only 13 percent said“dissatisfied.”

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When asked how the enrollment company or carrier couldimprove,  the answers were varied. The most common answerwas “improve their enroller quality.”

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The majority (60 percent) of the brokers surveyed said theytypically use a carrier's enrollment platform to do theirenrollments. Twenty-one percent don't use any technology platform.Ten percent use a third-party platform and nine percent aproprietary platform they (or their agency) created orcommissioned.

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Reason for Using Primary Carrier

ReasonPercent Choosing
The carrier has quality products.46%
We have a relationship with the rep orcarrier staff.26%
The carrier handles the entire casefor us.14%
We sell the carrier's employer paidand medical products.10%
The carrier provides enrollers.3%
The carrier has very competitivecompensation.2%

 

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When it comes to enrollment, the “tried and true” methods stillprevail. The most common methods are a combination of group andone-on-one meetings or voluntary or mandatory one-on-one meetingsonly.

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The largest percentage (39 percent) of brokers use in-houseenrollers to enroll their cases, followed by carrier enrollers at36 percent. Just four percent use an enrollment company and 13percent do not use enrollers but instead use online or call centerenrollments.

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Enrollment Meeting Method

TypePercent
Group meeting followed by one-one onemeeting29%
Voluntary one-on-one meeting only24%
Mandatory one-on-one meeting only23%
Voluntary group meeting only9%
Mandatory group meeting only9%
Internet/web4%
Call center1%

The survey also looked at what brokers think they need in orderto be more successful in selling voluntary products. “Moreknowledge about carriers and their offerings” was the top answerselected. “More time to sell voluntary” and “moreknowledge about products” were the next two most commonresponses.

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Overall, the survey showed brokers are evolving and engagingmore with voluntary products. The move has been dramatic in a fewareas and more subtle in others, but it's more than likely wehaven't seen the “end results” just yet. The market—andbrokers—will continue to evolve as the farther-reachingimplications of health care reform unfold.

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