As the employee benefits market grows even more commoditized, brokers are constantly looking for ways to differentiate. One of the best ways a broker can stand out from the crowd and build long-lasting client relationships is to become an advisor or partner in the employer's business.
One important aspect to becoming a trusted advisor is helping clients create a big-picture employee benefits strategy which will attract and retain top talent. I know many, if not most, brokers already suggest ancillary coverages to clients. The problem, as we know, is that many employers ignore that advice. In this article, I'll lay out some undeniable statistics about the ancillary benefits market you should be sharing with your clients, as well as lay out a strategy for more effectively selling ancillary.
Employers are falling short
A telling MetLife study looks at ancillary from the point of view of broker, employer and employee. This is where the disconnect lies. Brokers are recommending ancillary benefits, and employees feel many ancillary coverages are “must-haves”—but employers aren't delivering.
Here are a few examples from the study:
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Dental: 98 percent of brokers recommend it, 89 percent of employees consider it a must-have, but only 81 percent of employers offer dental coverage. Though that employer percentage is high, companies still need to do better here.
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Accident: 47 percent of brokers recommend it, 44 percent of employees consider it a must-have, but only 25 percent of employers offer accident insurance coverage. This gap is concerning; almost half of employees feel this option is essential to offer, but only 25 percent of employers do so.
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Prescription drugs: 93 percent of brokers recommend it, 71 percent of employees consider it a must-have, but only 54 percent of employers offer prescription drug coverage. This is another startling divide.
Why the disconnect? Employers are focused on managing benefits costs as health care costs continue to rise, so expanding their benefits package isn't their first priority. Brokers need to remind clients of the employee demand, and emphasize that not offering a comprehensive benefits package can actually cost them money in turnover and lost productivity.
Actions are louder than words
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