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Brokers use product bundling to offer clients more value

The best employee benefits package isn’t necessarily the one with the most bells and whistles. It’s the one the most employees sign up for — and the choice to participate often depends on a strong benefits education and enrollment support plan that empowers employees to make informed decisions. 

Voluntary benefits complement and help fill the gaps in major medical coverage with benefits employees can use for copayments, deductibles or other out-of-pocket expenses when an accident or illness occurs. These unexpected costs can be sizeable, especially with the continuing trend toward high-deductible health plans. Brokers can help their clients incorporate voluntary benefits to design a comprehensive, affordable benefits plan that meets the unique needs of their workforce and attracts and retains top talent — but if employees don’t participate in it, the employer’s investment of valuable resources is wasted. That’s why any successful benefits package needs to involve more than products and rates. It also must focus on helping employees understand their options, see how the benefits available address their unique needs, and encourage them to actively participate in their benefits program. Brokers can help their clients leverage best-in-class technology and benefit communication strategies to drive stronger participation in their voluntary benefits. 

Carriers offer flexibility and cost savings with product bundles

The number of carriers offering product bundles has grown significantly in the past four years. Eastbridge’s recent “Voluntary Product Trends” Frontline™ report shows more than a third of voluntary carriers now offer some type of bundle, most often supplemental health products such as accident, critical illness or hospital indemnity bundled with either core group disability and life products or medical and dental products.

Flexibility is a high priority for most carriers. These product bundles are more likely to be informal rather than fixed, so employees can select the products they want to purchase. Only one in five carriers that offer bundles present a set package where employees must make a yes or no election and can’t choose the components or coverage levels they need.

Carriers also understand the importance of helping employers create cost-effective benefits plans. Many carriers that bundle products offer premium discounts based on case demographics, risk and the types of products offered, such as medical plans, nonmedical employer-funded products or voluntary products. However, product quality and easier administration far outweigh price discounts for most brokers when choosing voluntary partners.

Product bundling meets employers’ top criteria for carrier selection

Product bundling can also play a role when employers select a voluntary carrier — but brokers may need to help connect the dots for their clients to see why. Recent Eastbridge research shows the top factors most important to employers when choosing a voluntary carrier are the price/value of the products offered and the ease of administration for billing and service. In addition, nearly two-thirds of employers say single billing for all voluntary products is an important or very important factor. These criteria all align precisely with the advantages of product bundling.

Packaging a better benefits plan

Brokers increasingly see the value in bundling voluntary products with one carrier to save their clients time and money through streamlined issue, billing and service, while carriers are meeting the demand for bundled products with flexibly designed packages. Together, brokers and carriers are helping employers achieve their goals for stronger value and easier administration — ultimately creating more competitive and affordable benefits packages for their employees. Voluntary product bundling appears to be both a growing trend and a winning strategy for all key stakeholders.

5Star Life Insurance Company is available to partner with brokers interested in helping their clients take advantage of the market’s trend toward product bundling. Learn more about us and our commitment to partnering with you and your clients by visiting us online.

 

 

 

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