The biggest threat to your voluntary business is not what you think says an October 4 BenefitsPRO.com article by Eastbridge’s Bonnie Brazzell and Nick Rockwell. In a recent survey conducted by Eastbridge and BenefitsPRO, brokers cited a lack of employer interest as the biggest threat to their voluntary business, but is that really the case?
According to the article, roughly 70 percent of employers offer at least one voluntary product. The percentage offering voluntary varies by the size of the employer, with the percent offering voluntary increasing with size—from 56 percent for employers with fewer than 50 employees to 86 percent for those with 10,000 or more.
Besides “to aid in recruiting and retaining employees,” the top reasons for offering voluntary benefits (selected by more than half of employers) were “employee interest in the product” and “to address gaps in current benefit plan/offer a wider array of benefits.” In addition, just because an employer already offers voluntary doesn’t mean there isn’t additional interest or opportunity.
Employers are interested in offering a variety of products to their employees. Among employers that do not yet offer a particular product, the products they are most interested in offering on a voluntary basis are critical illness, cancer, long-term care, and hospital indemnity.
The products employers are interested in offering vary based on the size of the employer. For example, employers with less than 1,000 employees have higher interest in offering long-term care and hospital indemnity compared to larger employer sizes.
The research also supports that once an employer offers voluntary, they tend to offer multiple products. About one-third of employers offer six or more voluntary products. Half offer between three and five, with the number offered varying by employer size.
The article’s authors raise the point that the issue is not employer interest, but refining your approach and confirming your market perceptions are accurate. Are you engaging all employers the same way, or are you tailoring your value proposition to the unique needs and demographics of each business?
According to the authors, the most successful brokers have long ago cast aside the assumption that employers are not interested in voluntary, and have been tirelessly working to understand and align themselves towards employers’ most pressing voluntary-oriented needs. Competing with these brokers, they say, may pose a bigger threat to your voluntary business than any perceived lack of employer interest.