I’ve noticed a new trend at the beginning of this year. On January 1, people proclaim their “word of the year” to create a tone, a feeling, or something to manifest over the next 12 months. Looking back over the year, my word of the year has been synergy.
I recently began working within my company, Crump, to cross-market individual life, disability insurance (DI), long term care (LTC), and in some cases annuities, with employee benefits, property and casualty, and Registered Investment Advisor (RIA) firms. This cross-selling role makes a lot of sense since Crump is one of the country’s largest brokerage firms for individual insurance products, and our sister companies are the largest in their respective categories—CRC for wholesale P&C distribution and BenefitMall for group benefits brokerage.
Cross-selling individual life insurance within an employee benefits firm can offer many benefits. By providing individual insurance options, employee benefits professionals enhance the value they deliver to clients. They can become trusted advisors who can assist with a broader range of insurance needs, guiding individuals through the complexities of personal insurance planning. This comprehensive approach strengthens client relationships and increases client satisfaction.
Synergies and comprehensive coverage
An employee benefits firm can provide clients with a comprehensive coverage package by proactively introducing individual life insurance as part of its offerings. This allows both the owners of the firms and their employees to address their personal life insurance needs along with their workplace benefits.
Offering buy-sell, key person, estate planning services, and other key protections that use individual insurance to business owners demonstrates the financial professionals’ commitment to meeting their clients’ overall financial protection needs. Direct interactions with the owners of the companies you serve can enhance the clients’ satisfaction, increase sales, and foster long-term relationships.
For employees, policies can be tailored to their specific needs to ensure that employees can supplement their group life and DI plans if their need for coverage is greater than the plan limits. This holistic approach can be a differentiator when in competition with other financial professionals.
Business employee retention and satisfaction
Providing additional insurance options for highly compensated individuals can be added as a proverbial “golden handcuff.” Offering coverage outside primary lines of business demonstrates a commitment to a firm’s well-being and can enhance overall employee satisfaction.
Solutions can be structured as an immediate benefit or designed to work as deferred compensation for retirement with a vesting period. This can increase employee retention by offering valuable benefits beyond typical workplace offerings.
Additional revenue streams
Offering individual insurance products expands the financial professionals’ portfolios and can create additional revenue streams. While employee benefits consulting forms the core of their business, selling individual insurance policies allows financial professionals to diversify their income and potentially increase their earnings.
With the advent of simplified and expedited underwriting, carrier “drop tickets” (where financial professionals can complete a short form application online), and the availability of platforms by distribution firms developed for employee benefits professionals to streamline the process, these additional lines have become much easier to implement.
Market demand and playing defense
As mentioned earlier, there is a growing need for personal insurance coverage, especially business owner succession. Principal did a study in 2021 (Business Owner Insights survey conducted by Dynata) and discovered the following that produced some exciting results. Did you know:
- Business protection is a typical business owner’s top priority—only 50 percent have business protection plans in place.
- 41 percent of business owners don’t have a written business continuation plan for death, disability, or retirement.
- Several studies have cited that 98 percent of business owners don’t know the true value of their business.
Many employee benefits firms are prospecting potential clients using individual insurance planning as a door opener as a pain point that a business’ existing employee benefits firm is not addressing. Introducing awareness of the need and the coverage gap a business may have opens the door for broader conversations like their employee benefits package and service.
Convenience and simplicity
Clients can benefit from the convenience of obtaining life insurance through the same firm that handles their employee benefits. It simplifies the process by providing a one-stop shop for their insurance needs, making managing and understanding their coverage easier.
Overall, selling individual life insurance, disability insurance, and long term care insurance allows employee benefits financial professionals to provide comprehensive solutions, engage in holistic financial planning, diversify their revenue streams, deliver value-added services, identify cross-selling opportunities, and cater to the market demand for personal insurance coverage. Let synergy be one of your words of the year!
