I've spent a lot of time in recent weeks talking to insurance brokers who work in the group insurance and employee benefits space. I've reached the conclusion that they are the unsung heroes of group insurance.
The role of a broker in group insurance
The broker is there to primarily represent the interests of the insurance buyer. However, brokers are generally compensated with commission payments from the seller (insurer). As providers of financial advice, brokers are also usually regulated by government in some way (who are interested in ensuring that advice provided is competent and that the advice looks after the interests of the consumer).
These competing tensions create an interesting dynamic for the insurance broker. Insurance companies think of brokers as their sales representatives, and also as their primary customer service channel. Insurance buyers think of brokers as the experts on insurance products, and someone who is able to get them the lowest price possible while looking after their needs.
Being able to be seen as a trusted business advisor by the buyer when the buyer knows you are being paid by the seller is no mean feat!
Once a group insurance product is sold, the broker does most of the heavy lifting for the insurer in terms of obtaining information from the customer. Unlike property insurance (where you might obtain information once across the lifetime of a policy and check at renewal time if that information is still current), in group insurance employees are coming and going all the time, creating constant changes to the group policy. This means more frequent requests to the employer for updated employee information, more chasing and following up, and more administration generally. A group insurance plan is rarely static!
Why selling group insurance is very different for most brokers
Brokers who are accustomed to successfully selling personal insurance (house, car, travel, life, health) often experience difficulty when they try to take the exact same sales approach to selling business-related insurance (commercial property, cyber-risk, business liability, group life and health).
I asked an experienced adviser why he thought this was happening. His answer was pretty insightful.
"Advisers selling business insurance need to realize that the buyer (usually the business owner or a senior executive) expects you to understand where insurance fits in the context of running their overall business.
They expect you to think like a business owner. It is simply not enough to be able to know and describe what the insurance products cover. You need to be able to understand the range of risks that a business owner is trying to manage, and the constraints that they face trying to manage all of those risks.
Only then should you suggest where insurance could be an appropriate and affordable piece of their overall business risk management game plan. Buyers expect their brokers to bring this level of business understanding to the table with them. It is a very different sales process than for personal insurance".
The broker-customer relationship is still very much a trust and relationship-based game. That trust curve is higher to climb when selling business insurance. But once achieved, brokers can assume a 'trusted adviser' role with their business customers. Business owners don't have the time or the patience to understand all of the nuances of various types of business insurance cover - so when they find a broker / adviser that they feel they can trust and rely on, they are usually very happy to 'outsource' the job of finding the right insurance coverages for their business to that person.
What brokers are saying they want and need
Most brokers say that the thing they need most from insurers is quick responsiveness. When they have a question, can it be answered in a timely manner? This basic need is always number one from brokers. Their customer or prospective customer has a need, they have a question that relates to that need, and they want a quick response.
This extends to customer service generally. In group insurance, a broker might have spent over a year with a prospective customer getting them to the point of purchase and decision regarding a group insurance coverage for their employees. They are excited! The staff have been told they'll be receiving a new company-paid benefit, the boss is feeling the love from the team, and everyone is paying attention.
If the insurer in response takes over a month to set up the newly purchased plan and issue coverage documentation, both the buyer and the broker will naturally feel deflated. All the excitement and attention that was evident a month ago has been eroded by slow fulfilment. Once a customer has made the decision to buy, they expect the customer service and fulfilment experience to be consumer-grade.
Most brokers put this poor service experience down to 'clunky insurer systems and processes'. They see first hand the points of friction, forms, double handling of information and delays. They acknowledge that it is a team sport - their own systems and processes also have to be efficient, and the insurer's systems and processes need to be as well.
As the primary customer contact point, they also need to support and educate their customer (the group policy buyer) about the information they need to provide, and try to make it as easy as possible for them to do that.
The main takeaway from all of this? Administrative systems and processes in group insurance need to be responsive and customer-friendly. Customers will compare their service experience to online retail and banking. They rightfully expect speed, accuracy and convenience.
Brokers are heroes in group
When you consider the multiplicity of skills and competencies that a good broker in the business insurance and group insurance space needs to have, it does border on the heroic.
Business-savvy, patient, consultative, administratively very well organized, technology-comfortable, great at relationships, great at customer service, continuously learning .. the list never ends, and it sounds like you are describing a unicorn. Add to that sales performance expectations from the insurers who's products you represent, and your income dependent on your customers having the financial wherewithal to buy insurance at all - and it is a very unique set of skills.
So here's to the brokers in the group insurance space. We're here for you! Sentro improves responsiveness and customer service in group insurance administration.