By Brian M. Kalish
Many brokers might want to change the way they do business. A majority of employers are not happy with the service they provide, according to a new Zywave white paper.
What employers are looking for from their broker is changing more than ever, explains Dave O’Brien, division president of insurance solutions at the Milwaukee, Wisc.-based company. The annual “Broker Services Survey” asked more than 5,500 employers in a range of industries what they would be looking for if they were to consider changing their broker.
In the past, the ability to negotiate a lower premium always ranked highest. Last year, 61% of employers said that was highly important — that number dropped to 27% this year. “Brokers focus on price, price, price,” O’Brien says. “But the top reasons employers left their broker was because they did not provide the level of service expected, did not keep them abreast of regulatory and legal issues, and did not properly manage insurance options.”
Further, Zywave says, as employers demand more service from their brokers, what brokers are actually delivering has decreased, from the employer’s point of view. Employers want to hear from their broker monthly in light of all the change going on in the industry. In the survey, 97% of employers say providing updates on health care reform and other legislation is important, but 23% are unsatisfied with their broker’s current way of providing information.
O’Brien explains a broker likes to tell a story when prospecting. “You will see the broker go in and talk about their years in the industry and history,” he says. “Employers are saying that is not all that important. What is really important to them [is] … updates on health care reform and employee communication.”
Other survey results include:
- 91% of employers say it is important that their broker create a strategic plan to align with company goals — but 43% are unsatisfied with their current broker
- 95% say offering employee benefits and consumerism communications is important — but 41% are unsatisfied with their current broker
Some ways for brokers to change their story include turning to technology products, of which Zywave is a provider. O’Brien says you can’t meet all the new demands the old-fashioned way, and technology is becoming “more of a must have than a great have.”
Further, brokers need to do more than say they provide great service — they need to provide examples of it. “Imagine if five brokers walk in and say, ‘It’s our people and our service.’ You have to do more to distinguish that and define what service means,” O’Brien says. “How are you going to distinguish? Do you spent a lot of money [on training] making great people?”
The broker/employer relationship needs to be powered by performance and results. “When you talk about service, you have to defend what does that mean and how are you going to do it?” he says. “Give examples of things clients have received in the past. Tell them what you do, show them and tell them again.”
The survey was conducted during April to May and had 5,536 respondents, of which 33.4% were HR professionals, 15.3% C-suite and 8.7% benefits professionals. Of the employers who responded, 55% have 100 lives or less, 20% 100-249 lives and the rest 250 lives plus.
SourceMedia. (2014). Employee Benefit Adviser. Retrieved from Benefit News: http://eba.benefitnews.com/