Property Casualty 360 published a great article for Insurance Agents about Selling Benefits. Here are some snippets from the article:
Sallie Giblin has some words of advice for P&C agents looking to expand their agency operations into group benefits.
“The most important thing that P&C agents need to know,” says Giblin, executive vice president at Lockton Insurance Brokers in La Jolla, Calif., “is that benefits today is not what it used to be.”
The Affordable Care Act (ACA) and its compliance requirements, rising insurance rates, reduced commissions, technology disrupters and even millennial demands have changed the ways in which agents and brokers sell group health. In 2016, it’s all about consulting and risk management.
Eric Diamond, director of group benefits at Poughkeepsie, N.Y.-based Marshall & Sterling, says the group benefits space “has become very complicated—and very consolidated.”
However, it’s not impossible to break into group benefits. He adds: “Benefits is in a better place now, because it has forced brokers to be much more creative rather than just focusing on the placement of insurance policies.”
On the following pages, longtime benefits experts offer eight tips that can help P&C agents and brokers get into this market.
Leverage Pre-existing P&C Relationships.
At Marshall & Sterling, where 20% of its annual revenue comes from benefits, the 150-year-old brokerage turns to its established P&C relationships to bring in new group benefits accounts. For agents, it’s the easiest way to develop new opportunities, says Diamond.
John Sarich, vice president of strategy at VUE Software, an insurance distribution management company, concurs. “The hardest thing in insurance is managing relationships,” he says. “If you have a client who is spending $100,000 a year with you in premiums, it isn’t a great leap to sit down with them and talk about employee benefits.”
A company is more likely to stay with your agency or brokerage if you write multiple lines for its account. “Somebody who has one policy with you will shop every year,” says Barry Seigerman, an independent broker and producer with more than five decades of experience. In addition, providing multi-line coverage to a single company prevents your competition from entering into that account.
Seigerman suggests that P&C firms partner with an outside third-party benefits company when starting out in the group benefits space, because these firms will have the expertise to navigate any compliance issues (see No. 6). “You won’t earn the commission, but it’s an opportunity,” he says.
Read the full article here, on PC360.