It’s important it is to actually fulfill the promises those benefits provide
By Tony Grosso
Ask anyone in the hiring world, and most will tell you that over the past few years, more and more job seekers are ignoring job descriptions without a listed and clear benefits package.
If simply having a benefits package is key to getting considered, imagine how important it is to actually fulfill the promises those benefits provide.
I know that last sentence might sound a bit inane at first. Why wouldn’t an employer or insurer deliver on the benefits they sell? But stick with me because it doesn’t always happen like it should.
Insurance’s major ‘Fire and Forget’ problem
As modern as we all think we are in the workplace, we’ve got some major blind spots, and benefits enrollment processes are some of the worst offenders.
When employees have to use manual, or partially manual, processes to enroll in their company-offered benefits, a tragedy can happen. Once the end customer and their employer fire off the paperwork to the insurance company, they assume the insurer takes care of everything and they’re all set from there.
But too many times, an end customer may not qualify for the level of coverage they selected, or qualify for any coverage at all. They get no notice of the coverage refusal or downgrade, and get a very unpleasant surprise when the enrollment report comes, at which point it’s too late to fix.
This rapidly degrades the customer experience. The employee is upset, so they complain to their HR manager, who must spend time researching the issue. They call their broker, who has to do the same. Why? The carrier’s segregated and siloed legacy technology may not be built to integrate new demands of online enrollment.
Not to mention manual errors that can happen. When information is passed and entered manually via paperwork, there’s a higher probability of human error. If a tiny decimal point is entered into the wrong place, it can have catastrophic consequences to the financial situation of the end customer who was relying on the policy.
This is where brokers step in. They help insurers pick out health benefits carriers that they know have dependable enrollment technology to plug these gaps, AND are able to follow up to work with employees if their coverage needs to be adjusted. This can relieve the burden for inhouse HR staff.
But then there’s the terrible enrollment numbers
It is one thing to build relationships with carriers and help them understand how they could improve their customer experience, so they are considered when bidding for group business, and remain competitive for new deals that arise. But it is another entirely to help them realize just how much they’re leaving on the table when they don’t upgrade their enrollment systems to be fully integrated. You can turn it around to how much they can GAIN. That can have a powerful impact when you show them you are their ally.
While at the recent LIMRA Enrollment Technology Strategy Seminar, a panelist said data shows that when online enrollment is fully connected, insurers can expect an 80% completion rate, greatly increasing their revenue from any one deal they have with any given employer.
But as soon as you introduce an enrollment system that’s disconnected or partly manual, that completion rate plummets to 30%.
And when it’s fully manual?
A measly 10% to 25% completion rate results, meaning that even if an insurer has more contracts with large employers than other benefits vendors, they’re leaving up to 90% of their potential revenue from those deals on the table. Just because they have not yet modernized.
Driving a stronger perceived “employment value proposition”
When people join a new company, no matter how reputable it might be, they may still be a little nervous about whether or not making the leap was the right move.
Not only can having a flexible core system and connected ecosystem help carriers and brokers sell more types of coverage to make their employer clients more competitive to new employees, but having solid enrollment technology can help them keep their employees happy, thus retaining top talent and reducing turnover.
Imagine how it would feel to be an employee, six months into a new job, who suddenly needed emergency surgery.
During their onboarding, they know they filled out the paperwork for hospital indemnity and short-term disability insurance, so they agree to the medical care and take time off without a second thought. Insurance is there to give people peace of mind in scary situations like this, after all.
Then, six weeks later, their bills come in the mail, and their STD payments haven’t processed like they thought they should.
Not only is this person much worse-off financially, they’ll probably hold this against their employer for using a sub-par benefits partner, and be on the hunt for a new job immediately. One with a more reliable benefits program. And brokers who work with insurers who know how to fulfill that need for both attractive and reliable benefits packages will be the real winners over the next few decades.
Technology evaluations in benefits program RFPs
In my opinion, one of the most exciting things in the health benefits insurance market is the fact that brokers are now putting technology evaluations into their request for proposals (RFPs) to help employers select the right benefits vendor.
As a society, we are so far past the dark ages of pen and paper enrollment for anything, and there’s no real reason why insurance providers should have a special pass to not have to upgrade their operations to match.
The fact that brokers are now compelling insurers to face the music regarding their Application Programming Interface (API) connectivity, enrollment technology, and customer service automations makes my insurance geek heart so, so happy. (Not to mention how good it makes me feel to know that fewer and fewer people are facing financial troubles due to the ball being dropped during their benefits enrollment.)
Tony Grosso, head of GWB Insurance Markets, EIS, has over 25 years of hands-on experience leading innovation, business development, product and marketing across all sectors of the insurance industry. Tony is leading the Guaranteed Withdrawal Benefit (GWB) market for EIS, a high growth company, helping insurers to achieve their ambitious plans and incredible potential.