Agency's Total Benefits Approach helps maintain client relationships
Large employers may need a corporate employee benefits broker with a national collection of urban offices, dozens of account executives and a sophisticated network of communications technologies.
But small to medium-sized employers need much more than corporate quantity, says Bill Rue Jr., president of Rue Insurance in Hamilton Township, New Jersey. They need an agency that can provide a combination of quality, personal service and access to informed day-to-day problem solving.
And as the employee benefits industry evolves with health-care reform, they need partners that have deep knowledge about the human resources and regulatory compliance issues that are becoming increasingly confounding.
"There are so many lone agents out there who have built personal relationships with clients but do not have the time or the resources to pick up their phones and solve problems for their clients. Their service begins and ends with placing the insurance coverage," he says.
But Rue Insurance has built a growing employee benefits practice on a level of service that transcends the sole practitioner and maintains the personal relationships that generate confidence, he says.
Founded in 1917 to assist farmers and other rural businesses with property/casualty and personal insurance needs, Rue Insurance is a relatively late comer to the employee benefits business. Bill Jr., joined his family agency in 2002 after working for investment banker Merrill Lynch and quickly noted an opportunity in employee benefits services.
MetLife study probes usefulness of voluntary plans, and what ?can make them better
Do your clients struggle to recruit and retain new top workers-and build loyalty among their old guard?
Their employee benefits program may be the key-especially new voluntary benefits. The latest benefits industry research indicates that employees are responding more than ever to the social value of their employee benefits and how they meet individual needs.
And their agents and brokers perceive themselves at the forefront of the voluntary benefits movement and expect growing business from their employer clients.
But it's not just the kind of benefits available that matter. How employers communicate and support participation is critical to making programs successful. According to the MetLife 11th Annual Study of Employee Benefits Trends, only about 40% of employees recommend their employer as "a great place to work," but for those who do like their employer, employee benefits are among the top satisfiers.
About 60% of employees who would recommend their employers say that benefits are an important reason why they would want to stay with their employer. More than half (51%) say they are willing to pay more of the cost of benefits in order to have more choice of products that meet their individual needs.
The survey of more than 1,500 employers and 1,400 employees conducted last fall by GfK Custom ?Research also indicates that more employers are getting the message. About 58% say providing voluntary benefits is a significant benefits strategy-up from only 32% in 2010.
REVIVING INCOME GUARANTEES IN THE POST-DB PLAN ERA
LFG travels the long and promising road to in-plan annuity acceptance
Ever since defined contribution plans supplanted defined benefit plans as the predominant employee benefits retirement plan vehicle, no one seems to expect DB plans to return to their former prominence in the market. What has happened, though, is that the idea of a guaranteed level of lifetime income in retirement-which DB plans provide, and traditional DC plans cannot-is too good to go away.
In the past few years some leading writers of individual annuities have developed hybrid products for retirement plans that provide the security blanket effect of a defined benefit plan within the flexible delivery vehicle of a DC plan. (See "A Measure of Certainty"-August 2011 issue-for a discussion of Prudential's approach.) These in-plan annuities combine a guaranteed level of lifetime income with upside growth potential based on the performance of a variable annuity.
Annuity writers aren't the only ones interested in the in-plan market. In 2010 the Departments of Labor and Treasury invited annuity providers to hearings on worker retirement funding readiness. At the hearings, annuity company representatives made their case for including in-plan annuities in the retirement product mix. In 2011 the Senate Committee on Aging asked retirement plan providers for details about guaranteed income features in defined contribution plans.
Eric Levy, senior vice president and head of products and solutions management for Lincoln Financial Group's Retirement Plan Services business, testified at the Departments of Labor and Treasury hearings. Since that time, he says, "We've been out talking to plan sponsors and doing research which indicates a strong need for in-plan annuities. What's really encouraging is that among plan participants, it isn't only the near-retirees who see the need for the income guarantee. We're seeing strong interest among participants age 45 and up.
