Voluntary benefits are more than “something nice to do” or perks to entice employees. They are now considered core benefits for most companies. And, this isn’t just a passing phase. A 2018 survey by Willis Towers Watson, a leading global advisory firm, predicts substantial growth for many benefit products:
• Critical-illness insurance: 43% of employers currently offer – could increase to 71% by 2021
• Hospital indemnity: 24% of employers currently offer – could more than double to 50% by 2021
• Long-term care insurance: 16% of employers currently offer – could double to 33% by 2021
• Identify theft protection: 36% of employers currently offer – could increase to 63% by 2021
• Pet insurance: 34% of employers currently offer – could increase to 57% by 2021
The voluntary benefits marketplace is moving at a rapid clip. Five years ago, for example, in a sample of employers, 60% felt voluntary benefits were important in an overall employer benefit program. Today, over 95% see value in voluntary benefit products, according to Willis Towers Watson.
“Historically, employers offered voluntary benefits to supplement their core health and retirement benefit coverage,” said Lydia Jilek, Director, Voluntary Benefits, Willis Towers Watson. “Now, with an increasingly diverse workforce, employers no longer consider voluntary benefits as simply add-ons, but rather as a way to address a host of employee needs, offer choice and allow employees to personalize their rewards.”
“Voluntary benefits remain popular among employers and employees, and for good reason. These benefits are a cost-efficient way to provide additional coverage to employees, and they can help employers attract and retain talented employees, many of whom tend to migrate to employers who offer choice and flexibility. Employees, on the other hand, see great value in voluntary benefits, which they are able to purchase through their employer at a lower group rate compared with on the individual market,” said Jilek.
The other good news, according to Willis Towers Watson, is that improvements in enrollment technology are making it easier for employers to expand their voluntary benefit offerings — and the expanded choices are resonating.
So what does all of this mean for you, the agent?
Opportunity…with the right licensing or partnerships. The voluntary benefits market is very diverse, offering products from health and accident insurance to pet coverage. Agents will better serve their clients by being license in BOTH life and casualty products. If you’re ready to add on a new license, we can help you prepare for and pass the state licensing exam with Prelicensing Training.
If you are not dual licensed and don’t want to be, you could still get involved with voluntary benefits by specializing in a specific area…say accident coverage, requiring an accident and health license, then partnering with a casualty agent to offer pet insurance and a life agent to sell life insurance. However, unless you are also licensed to sell the same product, you cannot share commissions in California.
Ready to dive into the voluntary benefits market? Jack Holder, regional sales manager with AFLAC San Diego, says there are many ways for insurance producers to view and/or get involved in the benefits business:
1. Reactionary: Only offer enhanced benefits to clients who ask
2. Carrier Partnership: Easy because there is no shopping. But, choices can be limited.
3. In-House Voluntary Benefits Specialist: Attractive, but cost prohibitive
4. Partner With an Outside VB brokerage: Allows the broker/producer to have an extension to their business and build a revenue partner.
Want more guidance? Check out our new course #226 – Voluntary Benefits, available now and full of great information on this growing market. You’ll earn 2 hours of CE credit toward your next renewal. It’s on our website, www.ceclass.com. Just scroll down to the More Courses section.
Jack Holder has also offered to help other agents participate in the voluntary benefits business through affiliate programs offered by his company. His contact info is below:
Jack Holder | Regional Sales Coordinator
An Independent Agent Representing Aflac
8220 University Ave, Suite 200, La Mesa, CA 91942
Office: 619.609.0597 | Cell: 619.754.5161 | Fax: 1.800.683.1957