Common Benefits Advisor Problems: Adding Value, Part Two

Mike Ignatz has managed Business Development at The Benefits Trust since 2005. His drive and focus has helped The Benefits Trust provide better benefits plans to small and mid-sized businesses throughout Canada.

Common Benefits Advisor Problems: Adding Value, Part Two

In part one of our series on adding value, we talked about how educating employees and employers can lead to higher plan satisfaction.

Today, we’ll focus on why you need to know what you are shopping for before you shop around.

Know What You Are Shopping for before You Shop Around

Why do clients want to shop around? It often comes down to price. To determine the best course of action, you must find out what your client actually wants to achieve through their benefits plan.

The two main reasons to shop around are that the service you receive from the insurer is sub-par, or the client has a short-term outlook and is only focused on cost. For a client with a short-term outlook, it makes sense to shop the market and find the lowest price.

However, most clients have a longer-term outlook, meaning that you need to ask great future-based questions to help them find a sustainable solution. You won’t need to shop the market every year in search of the lowest price if the client understands that choosing a benefits plan is about more than just the initial plan costs.

Alternatively, a client may consider shopping around for brokers—either because their broker isn’t adding value or the client is just cutting costs. It’s up to you to prove your worth to clients. A good benefits advisor must ask future-based questions, help the client create a sticky plan, and continue to educate.

Here’s an example of how an advisor avoided switching insurance providers unnecessarily by asking a client the right questions.

Case Study: Understanding Client Needs

A broker had a passive, reactive relationship with an existing client of over five years. The client company had a custom benefits solution in place for its 22 employees, with 3 classes of benefits including executive benefits for the owner, very accurate budgeting, and flat costs.

The company’s new CFO had a contact who promised to save the company some money by switching to a new benefits plan.

Approach:A business man standing over a desk pointing at paper with his pen.
The broker set up a meeting with the client and new CFO, and started an important conversation. They emphasized the benefits promise and its three components: insurance, reimbursement, and administration. The CFO understood and agreed. So, what did they want to change? They wanted the same benefits plan, but cheaper.

The advisor explained that switching to a new plan would only change the timing of payments: now versus later. The CFO would also need to inform his boss that his executive benefits would change, which wouldn’t go over well.

Once the broker determined what the client really wanted and explained the options available, no shopping was required and the broker kept the client.

Ask the Right Questions and Avoid Disappointment

As an advisor, it’s crucial that you ask the right questions to determine why a client may want to shop the market. That way, you can make informed recommendations based on the client’s long-term needs rather than shopping around just to save a small amount in the short-term.

In the third and final part of this series, we’ll cover the roles and responsibilities of brokers, insurers, TPAs, and clients.

The Benefits Trust helps successful business owners build a better benefits plan than they can get anywhere else. Get in touch with us today!

Don’t miss our conversation-starter resource: 101 Sales Questions Every Benefits Advisor Should Know.

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