Voluntary benefits are not as easily understood as medical and dental, though many would argue that employees really dont understand their medical plans. The key to marketing voluntary benefits is education so employees can understand how these plans provide for special needs.
Why is it that some VB enrollments are a complete bust while others have high participation and are well received and appreciated by the employees? Successful enrollments are like a three-legged stool. First is the selection of the most appropriate benefits (
Proper strategy
The set-up of the enrollment is crucial. Without a well-coordinated enrollment, the best benefit designs may still not be well received by the employees. A successful enrollment will ensure that each employee understands the benefits and their enrollment in coverage is easy to accomplish. If guaranteed issue is available, it is important that each employee take the time to decide on benefits at the initial enrollment or they may find that coverage is not available to them at a later date.
Education is paramount, since most employees do not understand voluntary benefits the same as they may understand the need for medical, etc. Core benefits may be offered in a group setting or self-enrolled, but voluntary requires more explanation to understand the need. Needs-based selling is a very important component of VB, as employees do not care about features until they can visualize how the plans work for them.
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Without a successful enrollment strategy, participation will be low and everyone loses. Employees may miss an opportunity to enroll in needed coverage, the carrier may be subject to adverse selection, which could lead to rate increases, and the broker loses credibility and may incur liability.
Enrollments can be labor intensive and there is also a learning curve as the products and underwriting are different from core products. Using an enrollment firm that specializes in this market may be the solution for many brokers. An enrollment firm knows how to communicate these plans and set up an enrollment to maximize participation. Some brokers feel like they are giving up compensation if they utilize an enrollment company, but our experience has been the opposite as an experienced enrollment firm will typically substantially increase compensation due to increased participation in the plans.
Whether you spend the time to really learn this new market or use an enrollment firm, VB can be very rewarding for both you and your clients. If you do choose to utilize the services of an enrollment firm, I recommend you get them involved early in the process to make sure the plan is set up for maximum enrollment efficiencies.
Tygart CLU, ChFC is president of Corporate Benefit Solutions, Inc., a 27 year old enrollment company specializing in voluntary benefit communication and enrollments. He has 40 years of experience partnering with brokers and business owners. Reach him at (800)263-0401 ext. 702 or jtygart@cbsiga.com
