To compete for and retain talent in the Great Resignation, employers are increasingly looking to their benefits offerings to set them apart from the competition. The past two years have driven workers to look beyond healthcare plans and to think holistically about how they can tailor their benefits to address their specific situations. Today’s employees expect a menu of options they can choose from as they customize their benefits. Ancillary products, whether employer-sponsored or voluntary, can help fill the gaps for these employees.
According to a report from the Society for Human Resource Management (SHRM), by offering a range of benefits that top talent considers important, companies can increase recruiting effectiveness by as much as 11 percent. In particular, dental and vision insurance are two of the voluntary benefits that employees tend to see as both affordable and important, leading to strong enrollment.
Additionally, the pandemic has forced employees to really understand their healthcare options and face hard truths about how illness or an accident can impact household finances for extended amounts of time. Whether they experienced it first-hand or they watched a friend or family member struggle, it is not just the cost of treatment and care they are thinking about, but lost wages and mental health impacts on the rest of the family. Increasingly, employees are looking for insurance products that can protect against financial losses due to hospital stays, accidents, and other events that may cause them to be unable to work for a period of time.
Selling ancillary products also has benefits for brokers. Ancillary plans can add as much as 10 to15 percent in commissions per client. By increasing the share of wallet and serving as a trusted advisor and problem solver, brokers can strengthen client relationships and improve overall retention.
Five Reasons Employers Should Add Ancillary Products
When considering ancillary products, employers may be focused on the need to attract new employees and retain current ones. Increasingly, employees and prospects expect to see vision and dental options when reviewing benefits packages. But what many employers do not realize is that adding these popular types of coverage can also improve overall employee health, decrease costs, and reduce lost work time.
Detect health issues earlier: Regular dental and vision exams provide opportunities to spot early warning signs of costly medical issues, such as diabetes and hypertension. In addition to controlling long term costs for these and other diseases, identifying and treating these medical issues early can also mean an employee is less likely to take extended time off for more invasive treatments and recovery.
Improve self-care: Insurer Cigna reported that employees who bundled dental with medical were more engaged in the management of their overall health. That means they were more likely to have regularly scheduled screenings and exams, and to undertake more lifestyle changes to improve their overall health. More than 70 percent of working adults with dental insurance see the dentist at least once per year, compared to only 40 percent of those without dental insurance.
Lower costs for other health plans: Many insurance carriers will provide discounts to employers offering different lines of coverage, helping employers offer a better and more comprehensive range of benefits while also keeping costs under control.
Give employees peace of mind: Ancillary products like accident coverage and life insurance can help employees feel more secure about their family finances in the event of a lengthy hospitalization or death. There are products available that can help employees fill the high deductible gap and cover unexpected medical expenses and lost wages. Interest in these types of coverage has grown as many employees watched their friends and families struggle financially during and after COVID hospitalizations.
Reduce lost work hours: Employees’ poor health cost American businesses $575 billion and 1.5 billion days of lost productivity, according to Ameritas. Vision and dental coverage make it easier for employees and their families to be proactive about overall health. Employees with family dental coverage are more likely to seek regular exams for their children, lowering the likelihood they will need to take time off for a child’s dental emergency.
How To Be a Trusted Advisor
Ancillary products have clear benefits for both employers and employees. But brokers are sometimes hesitant to upsell, finding it cumbersome to quote and evaluate non-medical plans. It is worth remembering that current and prospective employees are looking for well-rounded benefits options, whether employers are thinking about this or not.
Rather than wait for clients to inquire about what’s possible, look for ways to initiate conversations about ancillary offerings. Here are some ways to approach those conversations proactively.
Think of benefits as an extension of culture
One after effect of the pandemic is that employers of choice are emphasizing company cultures that recognize employees as whole people with concerns, priorities, and responsibilities outside of work. This is something employers can address directly through benefits. By giving workers more options to choose from and by making it easier for them to prepare for emergencies and protect their families, employers can demonstrate their commitment to employees.
One size does not fit all
Employees in different phases of life have different priorities and different benefit needs. A single employee at the start of their career may not think much about preventative healthcare and screenings, but might be interested in student debt products or pet insurance. Employees with families may be thinking more about income replacement in the event of an accident or life insurance to help survivors manage after a sudden death. Still other employees have caregiving responsibilities for aging or ailing family members in addition to managing their own households.
For most employers, members of their workforce represent a variety of ages, families, and other priorities and responsibilities. Employees are looking for highly tailored, customized benefits packages. Instead of offering all employees a benefit that many may not need, employers can enable employees to tailor a combination of products to meet their unique situations and concerns.
Educate employers on the possibilities
There is growing interest from employees wanting to better understand their healthcare options and benefits. Just a few years ago, many employees simply signed up for traditional benefits at enrollment time, approaching the task as an action item to complete. Today, employees are approaching benefits as true consumers, expecting to shop for the best options to meet their needs. This is a learning opportunity for both employers and employees.
Proactively educate employers on the various benefit options available and the different needs they can meet. Talk with them about the makeup of their employee base to better understand and anticipate employee needs, then identify products that can help fill the gaps on unaddressed issues. Particularly with ancillary products, it may be that employers have not considered a benefit because they did not know they had options to choose from. Employers that recognize and support all aspects of employees’ lives will find themselves in the strongest positions to hire and retain top talent.
Use real world examples
One way to help employers work through “what if” scenarios is to incorporate real world examples in discussions. For employers, one of the advantages of working with a broker is the ability to tap into expert advice and the experiences of other employers in similar situations. By providing real world examples of how other employers have approached similar challenges, it is easier to guide clients to the best solutions for their businesses. By offering more ancillary benefits, employers can empower their employees to personalize their benefit choices in meaningful ways.
Keep the Information Flowing
Understanding and selecting benefits offerings can be overwhelming for small businesses. Employers look to their broker partners to keep them updated on the latest offerings, news, and best practices. Keep the information flowing, even if clients are not responding to every piece of data shared with them. As employers become aware of what’s possible and what current and prospective employees are looking for, they cannot help but take action.
With the growing demand for employers to compete for talent with robust, customizable benefits options, brokers are in an advantageous position to increase the bottom line of their business by selling a mix of traditional and ancillary benefits. The key to making these sales is to anticipate client needs, educate them on their options, and guide them to the right mix of offerings for their business.
