- 3,384
If the carrier found out about that they might be inclined to terminate your contract. There is no legal basis and if the carrier allows BOR, then it is contrary to carrier's rules.
Can We do This....?
- Thread starter Jerry Tibbs
- Start date
If the carrier found out about that they might be inclined to terminate your contract. There is no legal basis and if the carrier allows BOR, then it is contrary to carrier's rules.
My guess would be that 1000 accounts represents a minute portion of the group accounts though. I bet they have hundreds of thousands of groups in CA.
- 3,384
No doubt it does not represent the lion's share of group business on the books in a given month. However it does show that group is a predatory business, with agents constantly trying to drive a wedge between the existing agent and the group (often based on premium).
There are protections however they are minimal from the carrier side. That was really my point.
- Staff
- #14
- 1,571
How exactly would this work?
Um mister client, thank you very much for the opportunity to work with you. I suspect that at some point in the near future you may find my services lacking and wish to have another agent take over my responsibilities.... Can you please sign here that you won't do that...
Service your clients well and you won't lose too many to a BOR. Every once in a while they will come anyway, because someone's brother in law now sells insurance. Take a BOR from someone else's group and move on.
Um mister client, thank you very much for the opportunity to work with you. I suspect that at some point in the near future you may find my services lacking and wish to have another agent take over my responsibilities.... Can you please sign here that you won't do that...
Service your clients well and you won't lose too many to a BOR. Every once in a while they will come anyway, because someone's brother in law now sells insurance. Take a BOR from someone else's group and move on.
- 242
I have no doubt that each state is handled differently, but I can state that there are many, many agencies (big consulting houses as well) that market with the BOR being the decision point.
The fact that you'll come to realize quickly is that many employers will be willing to listen, nod in agreement and love what you have to say, but are very slow to "fire" their existing broker. It will amaze you at the level of discontent employers will endure before agreeing to sign a BOR.
That being said, the small group market is absolutely starving for solid, professional advice from someone who doesn't start the conversation with "Let me show you a way to save 30%".
It would be mere incredulity to suggest there is no competition in this market, but most of the competing agents will be neophytes whose sole focus is on product and product alone. THINK ON THIS: A product will not solve the problem. You'll have to become an advisor and take a more consultative approach and you should be able to secure a lot of small group business BOR or otherwise.
Good luck out there
The fact that you'll come to realize quickly is that many employers will be willing to listen, nod in agreement and love what you have to say, but are very slow to "fire" their existing broker. It will amaze you at the level of discontent employers will endure before agreeing to sign a BOR.
That being said, the small group market is absolutely starving for solid, professional advice from someone who doesn't start the conversation with "Let me show you a way to save 30%".
It would be mere incredulity to suggest there is no competition in this market, but most of the competing agents will be neophytes whose sole focus is on product and product alone. THINK ON THIS: A product will not solve the problem. You'll have to become an advisor and take a more consultative approach and you should be able to secure a lot of small group business BOR or otherwise.
Good luck out there
- 596
It would be mere incredulity to suggest there is no competition in this market, but most of the competing agents will be neophytes whose sole focus is on product and product alone. THINK ON THIS: A product will not solve the problem. You'll have to become an advisor and take a more consultative approach and you should be able to secure a lot of small group business BOR or otherwise.
Newhealthstrategies,
This is an excellent point and really started to get me thinking. I also find most small businesses are under served, however, getting them to realize it and take action to sign a AOR can be difficult. Many times it almost seems like an abusive relationship and they just figure it's safer to stay with the known than unknown.
What types of services are you currently offering your small groups, let's say under 20 employees. Here is what I do, but curious to hear from others:
-Annual review: a given, right, although many brokers don't do this.
-COBRA administration: or for the under 20's, state continuation requirements
-Quarterly proactive service call
-I've thought about creating a password protected webpage off my site that will allow them to access their benefit summaries at any time, but I'm not sure if that would create enough value to justify it.
-I offer benefit statements, but find few take me up on them
How do you show enough value to get an AOR before just switching carriers? Right now I just use my judgement, sometimes I ask for it and sometimes I don't and rely on becoming the agent when they switch carriers.
Newhealthstrategies,
This is an excellent point and really started to get me thinking. I also find most small businesses are under served, however, getting them to realize it and take action to sign a AOR can be difficult. Many times it almost seems like an abusive relationship and they just figure it's safer to stay with the known than unknown.
What types of services are you currently offering your small groups, let's say under 20 employees. Here is what I do, but curious to hear from others:
-Annual review: a given, right, although many brokers don't do this.
-COBRA administration: or for the under 20's, state continuation requirements
-Quarterly proactive service call
-I've thought about creating a password protected webpage off my site that will allow them to access their benefit summaries at any time, but I'm not sure if that would create enough value to justify it.
-I offer benefit statements, but find few take me up on them
How do you show enough value to get an AOR before just switching carriers? Right now I just use my judgement, sometimes I ask for it and sometimes I don't and rely on becoming the agent when they switch carriers.
- 4,096
An AOR can easily happen depending on the insurance contract. This can happen on large group cases or small. I have seen large self funded accounts get switched over.
I have seen other brokers have clients sign a contract giving the broker the rights to quote the group. If the account wanted to change to a new broker I doubt the contract would hold up.
I have seen other brokers have clients sign a contract giving the broker the rights to quote the group. If the account wanted to change to a new broker I doubt the contract would hold up.
- 242
That, Delta76, is the $1 million dollar question.
Here are my thoughts on small group. I by no means,have a lock on this market, and am actually looking forward to reading what some others (Somarco, etc.) have to add.
Here is what I have concluded over the years:
Small business owners think buying group health is like buying a car... get 4-5 agents to "bid" against each other.
If they have an agent and they're shopping, the chances of them moving are slim-to-none.
They don't understand the insurance marketplace... nor do they understand how to properly build a sound employee benefit platform... they do it piecemeal.
They are typically "A" type personalities and know everything about everything... including health insurance... so expect to be treated as a peon that is simply gathering "quotes" for them.
They don't want some long drawn out explanation, they want you to email it to them, and they'll "....take a look at it... and get back to you."
NOW... with all that being said.... THOSE are your objections/hurdles that you'll have to overcome.... STILL INTERESTED? Hope so, as these are the reasons this is an underserved market.
Now to answer your question: I'll try not to be long-winded here (opps, too late).
You will win some and lose some for sure, but "giving" stuff away won't work in the long run... as you're finding out (with the benefit statement)... most don't care!
There is a great opportunity right now to be creative. Show them how to move deductibles higher, but with an HRA, keep employee exposure the same.
Be firm about this not being an easy solution. To maximize all that is available to an employer, you'll have to craft a blend of FSA, Group Health (and other group products), HRA or HSA plans.... advise them on contribution strategies that make sense and give them some out-of-the-box ideas that they aren't getting elsewhere.
I ALWAYS blind any actual quote I give unless I'm the agent of record. It probably doesn't matter, but I refuse to help the existing agent... making his/her job easier.
I ALWAYS ask early on... that if they find value in our conversations and my ideas/strategies are they prepared to fire their current agent and let me be their advisor? IF they balk or tell me no... then I'm quick to end the discussion.
You need access to data... ALL their data... otherwise, you'll be doing nothing buy guessing... and we all know guessing will get you nowhere.
You know more than they do... but convincing them of that will require some face2face time or phone time actually talking about what they've BEEN DOING... so you can come up with something different and doable.
I almost always use this line somewhere in my initial conversation with the owner: Usually just after I ask, so every year when you get your renewal increase... do you usually go into panic mode and search around for a solution? THEY ALWAYS LAUGH AND SAY...Pretty much, yes! I respond with "So how is that working for you?".
If they say they're happy with their current broker.. I respond with "So, your broker was able to LOWER your costs last year?"
Be happy to discuss further if you want to persue it.... [email protected]
Hope that is somewhat helpful.
- 4,096
New Health is right on.
Most small groups the owner does one aspect of their business very well and health insurance is not one of them.
Giving a plan design that is out of the box is key. what I would add to that is not just selling the employer on it but being able to sell the employees on the plan. Being able to convince the employees that the new plan is a wonderfull benefit helps the owner with less grief about plan changes.
A lot of brokers will not spend the time on a small group employee meeting. By spending the time with small group and educating the staff about benefits will add to your importance as the broker/consultant for the group. The other aspect that I always communicate to a small group is they are lucky to have a health plan and that the owner is taking care of his people. There are plenty of stats about the small group maket to back that up.
The bottom line with small group is you have to save the group money.
Most small groups the owner does one aspect of their business very well and health insurance is not one of them.
Giving a plan design that is out of the box is key. what I would add to that is not just selling the employer on it but being able to sell the employees on the plan. Being able to convince the employees that the new plan is a wonderfull benefit helps the owner with less grief about plan changes.
A lot of brokers will not spend the time on a small group employee meeting. By spending the time with small group and educating the staff about benefits will add to your importance as the broker/consultant for the group. The other aspect that I always communicate to a small group is they are lucky to have a health plan and that the owner is taking care of his people. There are plenty of stats about the small group maket to back that up.
The bottom line with small group is you have to save the group money.
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