Category Archives: News

Group whole life soars at the workplace

December 14, 2017 | Jon Shuman | Employee BenefitsPRO

The first supersonic flight was welcomed with a huge booming sound across the California desert as pilot Chuck Yeagers X-1 became the first manned airplane to reach Mach 1. The five-minute flight in 1947 was a historic moment celebrated in the film, The Right Stuff.

Another historic milestone occurred in the insurance industry last year but was greeted with considerably less fanfare. Like the flight of the X-1, though, last years event marked a watershed for Americans, at least for their financial futures.

For the first time ever, more people owned group life insurance rather than individual policies in 2016, according to LIMRA (Life Insurance Ownership in Focus, 2016 LIMRA Ownership Study). While no sonic boom accompanied the milestone, the preeminence of group life insurance spoke volumes about the credibility that Americans place in their employers as a source of financial security and wellness.

Like the X-1, sales of life insurance have gone on to notch several other remarkable milestones:

  • The number of people who own some form of life insurance has grown to a record 172 million (2016 LIMRA Ownership Study). The increase in life insurance ownership is being driven primarily by people ages 18 to 44 – the prime time for starting and raising families – as ownership by people age 45 and older declines.
  • Sales of group whole life policies, typically available on a voluntary or employee-paid basis, increased by 19 percent in the first two quarters in 2017 (LIMRA U.S. Worksite/Voluntary Sales, 2017 Second Quarter Review).
  • Premiums for individual whole life insurance have grown every year since 2006 as consumers have gravitated to the products straight-forward design, built-in guarantees, and dividend potential (U.S. Retail Life Insurance Sales, Third Quarter 2016). Whole life now accounts for 37 percent of the entire individual life insurance market, the study finds.
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    3 factors driving the growth of voluntary benefits

    November 7, 2017 | Dennis Healy | Employee Benefit Adviser

    The high cost of healthcare and consequential evolution of insurance plans with high deductibles have created an improved market for voluntary products. Employers are eager to provide a more comprehensive and competitive benefits package that fills the gaps created by the risk-sharing approach of high-deductible programs.

    Additionally, commissions generated by voluntary can be used to fund overall benefits administrative costs and project work done by TPAs and consultants that would otherwise be borne by employers. The increased demand has also helped brokers replace income lost due to shrinking healthcare revenues.

    However, there are three areas in particular that are actively driving growth for voluntary benefits:

    1) Support for physical and financial wellness.

    2) Personal, on-demand preferences.

    3) The importance of technology.

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    Why A Long-Term Disability Policy Is More Important Than Pet Insurance

    October 11, 2017 | Michelle Andrews | Kaiser Health News / NPR

    “It won’t happen to me.” Maybe that sentiment explains the attitude of many employees toward long-term disability insurance, which pays a portion of your income if you are suddenly unable to work for an extended period because of illness, injury or accident.

    Sixty-five percent of respondents surveyed this year by LIMRA, an association of financial services and insurance companies, say that most people need disability insurance. But the figure shrank to 48 percent when people were asked if they believe they personally need it. The proportion shriveled to 20 percent when people were asked if they actually have disability insurance.

    Long-term disability insurance generally has a waiting period of three or six months before benefits kick in. That period would be covered by short-term disability insurance, if you have it.

    As the annual benefits enrollment season gets underway at many companies, disability coverage may be one option worth your attention.

    Some employers may be asking you to pay a bigger share than before, or even the full cost. That can have a hidden advantage later, if you use the policy.

    Or you may find that your employer has automatically enrolled you – or plans to – unless you opt out. A growing number of employers are going that route, to boost coverage that they feel is in their employees’ best interests, not to mention their own, since insurers usually require a minimum level of employee participation in order to offer a plan.

    Benefits consultants agree that although long-term disability coverage lacks the novelty appeal of some other benefits that companies are offering these days (Hello, pet insurance!), but it can prove much more valuable in the long run.

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    New Data Uncovers False Sense of Confidence Regarding Benefits Choices Among American Workers

    October 9, 2017 | PRNewswire.com

    76 Percent of Workers are Unsure about Health Coverage Specifics

    COLUMBUS, Ga., Oct. 9, 2017 — Aflac … today announced results from two studies that analyzed the trends, attitudes and use of employee benefits among the U.S. workforce. The 2017 Aflac WorkForces Report (AWR) shows that American workers may feel more confident about benefits choices, while admitting a lack of understanding regarding the choices being made. A separate Aflac study found younger workers who may be making benefits decisions for the first time also lack knowledge of health insurance coverage but want to branch out and make independent benefits decisions.

    American Workers May Have a False Sense of Confidence
    Benefits enrollment findings from the 2017 Aflac WorkForces Report, a national online survey of 5,000 U.S. workers, conducted between Jan. 26 and Feb. 17, 2017, by Lightspeed GMI and released by Aflac, found that more than half (55 percent) of American workers who receive benefits from their employer agreed that completing their annual health benefits enrollment made them feel secure, like being tucked in at night, or accomplished, like they just finished a marathon. And 67 percent said they are confident they understood everything for which they signed up.

    However, these results may indicate an underlying false sense of confidence. The survey also uncovered that 76 percent of workers are making benefits decisions without a complete knowledge of the overall plan. When asked specifically about understanding their overall policies, like deductibles, copays and providers in their network, only 24 percent of these workers could answer they understood everything. And this result has been on a steady decline since 2015, when nearly half (47 percent) believed they knew everything, and then down to 39 percent in 2016.

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    Supplemental doesn’t mean secondary

    September 27, 2017 | By Bruce Hentschel | BenefitsPRO.com

    When you think about the word “supplemental,” what comes to mind? Something less important? An add-on? A bonus rather than a necessity?
    Now consider supplemental benefits. While not the foundation of a benefit package, they shouldn’t be demoted to second class status. Supplemental benefits – coverage for accidents and serious illnesses – meet a unique need that core benefits don’t satisfy. That makes them important in an integrated benefit package, not lesser.

    Addressing coverage gaps

    Supplemental benefits provide protection beyond other benefits. If your clients say, “But we already offer medical and disability,” be prepared with the answer. While medical insurance helps pay for traditional medical expenses and disability insurance helps replace lost income, theres still a gap. Additional needs – those unexpected out-of-pocket costs – can be catastrophic. Expenses like deductibles, travel costs, childcare, home health care and even everyday bills.

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    Employers Pull Back on Popular Life Insurance Benefits, Surveys Find

    September 15, 2017 | By Cyril Tuohy | InsuranceNewsNet.com

    One of the cruel little ironies of life insurance is that more people than ever obtain coverage through a group life contract, but fewer employers than ever are offering the benefit.

    That represents an obvious opportunity for agents and benefits brokers.

    As many as 108 million Americans have life insurance coverage through the workplace, compared with 102 million covered by individual life insurance, according to a new survey published Aug. 30 by LIMRA.

    It is the first time that more people are covered by workplace life insurance than by individual policies since LIMRA began tracking data in 1960, LIMRA researchers said.

    The number of Americans covered by employment-based life insurance will continue to grow, but only slowly, said Anita Potter, LIMRA’s assistant vice president, workplace benefits.

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    Employees struggle with out-of-pocket costs, unaware of voluntary options

    July 20, 2017 | By Katie Kuehner-Hebert | Benefits Pro

    A large number of workers are struggling with out-of-pocket costs within high-deductible health plans, but many are also not aware of supplemental plans that can augment those costs, according to the Securian Benefits Survey July 2017.

    KRC Research surveyed 573 adults in group plans on behalf of Securian Financial Group, and found that one-third (31 percent) of those with employer-provided health insurance report having paid or know a family member who has paid an unexpected out-of-pocket medical expense in the past five years caused by a critical illness such as cancer, a heart attack or a stroke.

    Sixty-one percent say the costs were manageable, but a quarter (27 percent) say the costs set them back financially, and 12 percent say they could not afford the out-of-pocket costs and have not yet paid the bills.

    However, less than half (44 percent) of the respondents are aware that many employers now provide supplemental group insurance options to help employees pay for out-of-pocket expenses and other costs associated with an accidental injury, hospital stay or critical illness.

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    Voluntary benefits: 3 key insights on purchasing behavior

    July 7, 2017 | By Dan Johnson | Benefits Pro

    Some might believe being a good salesperson is all about talking, but this couldn’t be further from the truth. It’s actually all about listening to the customer. I’ve found that a great challenge of working in voluntary benefits is that one-size-fits all solutions don’t exist. Each customer comes with their own set of needs, wants and challenges, and you need to adjust your approach based on the client. And this requires listening.
    As part of our ongoing efforts to listen to customers, we partnered with an independent research firm and surveyed more than 200 employers to understand what drives purchasing behavior for voluntary benefits. I believe what we heard was insightful and would strongly consider it as you evaluate whether to sell voluntary benefits. Heres a look:

    1. 83 percent of employees with healthcare coverage and no voluntary benefits say they’re open to enrolling in voluntary benefits through their employer – and they don’t expect their employer to pay for them.

    2. 87 percent of employees in companies offering voluntary benefits feel they matter to their employers because of those benefits.

    3. Finally, 62 percent of employees under 50 years old wouldn’t consider taking a job that doesn’t offer voluntary benefits.

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    No end in sight for voluntary sales growth

    June 12, 2017 | By Phil Albinus | Employee Benefit Adviser

    The percentage of employee benefit brokers selling voluntary grew nearly 12% in 2016 compared to the previous year with the segment now owning 62% of the market, according to Eastbridge Consulting Group. Last year, voluntary sales reached $7.63 billion with $4.75 billion being generated by benefit brokers, the voluntary benefit consulting firms U.S. Voluntary/Worksite Sales Report found. Gil Lowerre, president of Eastbridge, does not expect the voluntary sales market to cool down soon.

    Benefit brokers generated $4.75 billion in new sales in 2016. For the second year in a row, career agents scored the second highest sales at $1.17 billion. Voluntary brokers – what the studys authors call classic worksite brokers and worksite specialists – accounted for $879 million and $658 million in sales, respectively.

    For the study, the Avon, Conn., consultancy profiled 65 individual and group insurance carriers.

    These numbers are a continuation of a trend that has been underway for years, according to Lowerre.

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    Why voluntary benefits are a win-win

    May 8, 2017 | By Greg Guidos | Benefits Pro

    According to a Bankrate.com survey, three out of four Americans are living paycheck-to-paycheck, with little to no emergency savings. Meanwhile, a poll conducted by NPR, The Robert Wood Johnson Foundation and Harvard’s T.H. Chan School of Public Health, shows even with year-round health insurance coverage, more than a quarter of adults face major financial problems, even bankruptcy, because of the medical bills they cant pay off each year. Further, health care reform in the U.S. has placed more of the burden of health care costs on employees, as employers adopt high deductible health plans.

    We dont know where the health industry is going, says Mike Wargo, national benefits director for Allstate Benefits, a Jacksonville, Florida-based provider of supplemental insurance to companies across the country. But we know health insurance premiums have risen and employers and employees have chosen higher premium plans.

    Its a Catch-22 thats squeezing employees and the economically conscious companies where they work. But its also presenting an opportunity for companies to recruit and retain top talent through voluntary benefits programs that dont impact their bottom line.

    A voluntary benefits program – which once may have been considered a nice-to-have option for employees and employers – has become an increasing necessity for many.

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