Any time an insurance carrier is contacted about the possibility of taking on a new plan the first thing they look for is a detailed list of plan specifications.
From those specifications, the carrier completes a pricing quote with rates based on the existing plan’s experience (premiums versus paid claims) and demographics (gender, average age).
Aside from these details, to more accurately reflect the risk and assess potential customer needs, the carrier may ask for additional information such as:
•The reason for marketing the plan. Is the plan too expensive? Are there service issues with the current carrier? If so, what are they? Is the current carrier not able to meet a current need?
•How long has the existing contract been in force? Most insurance carriers will not present a quote for clients that are frequently switching group insurance providers.
•Some knowledge of working conditions, employee support staff (on-site nurses, and so on), fitness centres, employee assistance programs, employee opinion surveys and any other programs and services that aid in employee satisfaction and retention. This will aid tremendously in assessing the disability risk.
•Are there any internal management tools, such as consulting services, for controlling disability costs and claims?
•Are there tools to help track absenteeism and the tenure of each employee?
•Have there been any fluctuations in the employee population in the last few years (layoffs, mergers)? This will help explain experience fluctuations.
•Are any employees unionized?
•What have been the optional life volumes?
•Are there any pooled claims identified in the experience?
•What is the benefit obligation to employees? Is it a competitive plan design within its industry, employee retention?
•A copy of the current contract and/or booklet.
In addition, the carrier may want pre-quote meetings to better assess the risk. This, however, may be more feasible for larger clients. Finally, an employer should always visit a potential insurance carrier prior to finalizing a purchase decision. A client should be comfortable with the new carrier, who will be providing an essential service to employees.
Joseph Iannicelli is the senior vice-president, Group Insurance for Standard Life.
From those specifications, the carrier completes a pricing quote with rates based on the existing plan’s experience (premiums versus paid claims) and demographics (gender, average age).
Aside from these details, to more accurately reflect the risk and assess potential customer needs, the carrier may ask for additional information such as:
•The reason for marketing the plan. Is the plan too expensive? Are there service issues with the current carrier? If so, what are they? Is the current carrier not able to meet a current need?
•How long has the existing contract been in force? Most insurance carriers will not present a quote for clients that are frequently switching group insurance providers.
•Some knowledge of working conditions, employee support staff (on-site nurses, and so on), fitness centres, employee assistance programs, employee opinion surveys and any other programs and services that aid in employee satisfaction and retention. This will aid tremendously in assessing the disability risk.
•Are there any internal management tools, such as consulting services, for controlling disability costs and claims?
•Are there tools to help track absenteeism and the tenure of each employee?
•Have there been any fluctuations in the employee population in the last few years (layoffs, mergers)? This will help explain experience fluctuations.
•Are any employees unionized?
•What have been the optional life volumes?
•Are there any pooled claims identified in the experience?
•What is the benefit obligation to employees? Is it a competitive plan design within its industry, employee retention?
•A copy of the current contract and/or booklet.
In addition, the carrier may want pre-quote meetings to better assess the risk. This, however, may be more feasible for larger clients. Finally, an employer should always visit a potential insurance carrier prior to finalizing a purchase decision. A client should be comfortable with the new carrier, who will be providing an essential service to employees.
Joseph Iannicelli is the senior vice-president, Group Insurance for Standard Life.
