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It used to be that William A. Kelly–who goes by the name of Tinker–would market worksite insurance products in the so-called "traditional" way.
That is, he would conduct group meetings of employees, at the workplace, to educate on the needs and explain the products. Then, he would follow-up with one-on-one sessions with each employee (or with those who were interested in buying).
No more. Four years ago, Kelly, who is president of Voluntary Employee Benefits Advisors in Nashville, Tenn., began using what is called an "alternative" enrollment method. That is, his firm adopted a "call center" model. It communicates benefits and product information to employees via comprehensive materials and then encourages those who want to know more or who want to sign up to call an 800 number.
"We have no face-to face meetings with employees at all," says Kelly, explaining that todays larger employers, especially Fortune 500 firms, will not allow direct access to employees.
Is this the wave of the future? Kelly and other alternative marketers say "yes." But there is also a whole cadre of worksite specialists who say, "No, the traditional approach is here to stay."
Take Anneliese Clark, district general agent for Colonial Supplemental Insurance in Jacksonville, Fla. She finds the traditional method to be very effective, regardless of group size. This year alone, her office enrolled two groups this way–with 9,000 and 6,000 lives respectively.
Far from rejecting onsite enrollment approaches, employers are actively in favor of this approach, she maintains.
With todays newly downsized workforces and smaller human resource departments, companies "need us more than ever," Clark maintains. They need onsite worksite enrollers to help communicate details about the entire company benefit plans–such as why medical deductibles are increasing–as well as why supplemental products can fill gaps and needs, she says.
This article examines the alternative vs. traditional quandary facing producers in this field and how specialists are responding.
First, here is a market recap. Worksite sales have been growing at a steady pace in recent years, according to Eastbridge Consulting Group Inc., an Avon, Conn., firm that follows the industry.
For instance, in 2002, total sales were up 15% over 2001, Eastbridge says (see Chart I). The figures are based on results of 41 carriers who responded to Eastbridges annual survey plus estimates for non-responders.
This growth has occurred in a wide assortment of worksite product lines–including life, disability, accident, cancer and critical illness, dental, hospital indemnity and medical supplement, investments and annuities, and long term care (see Chart II).
Along with the growth has come the expansion of enrollment methods, says Gil Lowerre, president of Eastbridge, citing results of his firms new worksite enrollment survey.
Employers still value the "traditional" methods of enrollment, says Lowerre. But "employers are asking for other enrollment options, too," he says. In particular, they are requesting alternatives such as Internet or telephonic enrollment strategies or combinations of those.
Kelly, the Nashville specialist, says employer attitudes started changing three to five years ago, as certain employer markets became saturated with worksite products. Specifically, he says employers started complaining about the traditional enrollment process. His firm did some research and found that many larger employers felt they had no control over what the enrollers were saying at the meetings, Kelly says.
Also, "some complained they had no guarantee the enroller would not oversell the employees. Some worried about perceived pressure on employees to participate. Others were concerned about privacy issues that could come up in the one-on-one meetings."
Finally, he says, the larger employers objected to the cost of sending hundreds of employees to the 15- to 20-minute one-on-one sessions to learn more and sign up.
In some cases the resistance to onsite enrollment has become so strong that HR directors tell Kelly flat out, "we want zero distractions" and "not on company time."
Given those parameters, Kelly says his firm has built a call center approach that focuses on written communications (e-mail, posters, announcement letters, 800-phone-number stuffers, and enrollment guides) plus an 8 a.m. to 10 p.m. call center and an information-only Web site.
To maintain the personal touch, he says, "we select call center people who are very consumer-friendly and helpful. It makes a huge difference."
And the results? "On a group with 10,000 lives, we typically get calls from 25% to 30% of the employees, and total participation, in one or more of the benefit offerings, is typically in the 20% range," he says.
Some carriers do not like the approach, he allows. "They prefer 40% to 50% participation. They want more revenues. And they want less exposure to adverse selection," Kelly says. "But, in our market, the boss in the equation is the HR department, not the carrier."
Clark, the Florida general agent, presents a much different picture. Some employers do express concerns about onsite enrollment, she allows, noting this is based on negative prior experiences. But once they see how onsite enrollments can help employees understand all their benefits, not just the worksite benefit, their eyes open up, Clark says.
Employers respond to a needs assessment approach, she explains. They like the idea of enrollers showing employees the benefits they already have, what the employer pays for the benefits, and the impact of supplemental benefits on employee paychecks.
Employers today realize they have less manpower available to do this kind of education, Clark says. "But they know they need someone to get the word out."
