Embracing today’s ‘one-stop-shop’ for the benefits portfolio
by Tom MurrayMr. Murray is head of Product Strategy for LifePlus Solutions at Majesco, industry consultants with over two decades of experience in providing technology solutions, products and services for the insurance industry across lines of business – Life, Annuity, Health, Pensions, Group & Worksite Benefits insurance and Property & Casualty (General Insurance). Reprinted with permission. Visit here.
May 9, 2019 — Many large employers use employee benefit packages as part of their approach to reward their employees and keep them motivated. Given the size and diversity of their workforces, employers frequently opt for cafeteria-style benefits, where the employees can choose the benefits that are most suited to their lifestyle and support the choices they made, rather than have to put up with a one-size-fits-all benefit approach. This enables employers to provide a far more personalized collection of benefits to the employee, thus strengthening the relationship between employer and employee.
The overhead of providing personalized financial benefits to employees is substantial but thankfully there are many systems available which allow the organization to set the high-level parameters and the individuals to select from the list the products and services they want. For example, employees can choose whether or not to join a group scheme for life protection or they can request to be a member of a particular pension scheme or to make additional voluntary contributions. These decisions can be varied at any point in the employees’ work-life as their personal circumstances, and therefore their personal goals, change. Examples of changing plans would be the employee getting married or having children.
Anything employees want above the levels being provided by the employer can usually be provided by the employee selecting to have the additional cost deducted directly from their wages. Allowing direct access to the employee means that employees can review these benefits at home with partners or family and make the best decision for themselves. A key point, however, is that employees should have a one-stop shop to review their financial position and see the big picture, allowing them to make better decisions going forward.
This is a far cry from what is generally available for those who are not lucky enough to have employee benefit systems in place in their workplace. They too need the type of holistic view of their financial position if they are to make the best decisions. But instead, they are often left to either manage their own affairs across a disparate number of sites and suppliers or, they have to engage with a broker or agent to do the work for them. Individuals’ management of their own financial affairs can thus be very difficult for those with the financial knowledge to do it themselves, or expensive for those who don’t.
Giving Power to the Customer
This is where portals can be a game changer. Life and Pension companies with products aimed at the individual market need to be able to provide the same levels of access to their clients as that provided by HR departments to their employees. Customers who like to manage their own financial affairs need digital access to their financial products first and foremost. Well-designed portals, accessible via desktop and mobile devices, can provide the customer with the holistic view of their financial position that makes it easier to see how their choices are working out and to make variations to help them reach their goals.
Taking this digital-first approach means that customers can manage their own financial affairs at a time and place that suits them, making it easier for them to stay on top of their financial affairs by regularly reviewing their goals and their progress towards them. These capabilities are especially important to the upcoming generations of Gen Z and Millennial customers. Majesco’s recently published consumer research shows that these generations have high levels of interest in using their mobile devices to manage their insurance policies, and are open to purchasing from non-traditional sources with strong digital capabilities, including online investment advisors like Betterment or Personal Capital.
Benefits for Agents, Too
Similarly, portals enable agents to provide far more comprehensive services to their clients. Having access to a client’s full range of financial products ensures that the agent has a holistic picture of the client’s financial position and is much better positioned to provide advice on changes needed to achieve the client’s goal. A digital-first approach enhances, rather than replaces, the services agents can provide and gives a level of efficiency that ensures far more customers can achieve the benefit of their advice. Decisions made can be enacted immediately, making it easier for the agent to do business with the provider and giving the customer the level of responsiveness they have come to expect from other industries.
Even for agents that deal with the type of HNW (high net worth) clients who demand personal service, the availability of a portal enables them to provide more immediate personalized assessments with up-to-date figures. Without one, the process can be extremely labour intensive and take so much time that the information is out of date by the time the customer receives it.
Comprehensive portals also give access to the tools for scenario and what-if planning, allowing people to easily test possibilities and analyze results to see the best combination of contribution and products that will meet their goals. Combining these with robo-advice features can provide recommendations for the customer to consider, and ultimately help increase sales by providing faster access to information for the customer.
Customer and Agent Portals can play a key role in helping life and pension companies deliver higher value services to their customer and their agents, ensuring a satisfied customer base and energized agencies who want to do business with the life provider because of the quality and reliability of the services provided.
Life and pension providers who allow customers and agents to engage with them via portals are opening the gateway to the provision of better, customized and more responsive services. They make it easier for customers to do business with them, either directly or via agents. This is surely the key to engaging with the Gen Z and Millennial generations, who want everything personalized for them and cannot understand why it has to be any other way.
Those providers who embrace the idea of making it easier for customers and agents to do business with them will reap the rewards in an age where customers expect everything to be focused around them. Those providers who don’t may find themselves outside the gates, looking in.