Broker/Client Disconnect

Employers say their brokers are not providing the value-added services they really want.
By: | October 1, 2014

Brokers think they are offering clients the types of value-added services they want, but many employers apparently don’t agree.

Slightly more than half (53 percent) of 3,275 employers surveyed earlier this year by Zywave, a Milwaukee-based software vendor, said they are not satisfied with the information their broker provides them on regulatory and legislative updates.

Nearly all (92 percent) of employers said they wanted those updates, according to the Zywave 2014 Broker Services Survey.

Additionally, 88 percent said they wanted assistance with workplace wellness programs, but 56 percent said their broker was “not delivering to their expectations.” And, while 65 percent of employers want brokers to help them develop employee handbooks, 85 percent said their broker is not doing a satisfactory job.

There is a disconnect between how the brokers believe service distinguishes them and the way that employers feel they are being serviced, said Dave O’Brien, Zywave’s chief executive officer.

“That speaks to the discovery process many brokers have when they are courting prospective clients,” O’Brien said. “They tell them about the history of the firm and about their people, but in reality, they should be asking employers about their own histories, problems, and what they may need from the broker.”

The brokers that ask these kinds of questions up-front, and then periodically check with clients to see if they are meeting their needs, stand to beat out competitors as employers increasingly seek greater guidance, he said.

Smaller brokers may not be able to provide these additional services on their own, but they can leverage technology to offer services similar to those of larger brokers, he said.

Kelly Hagan, director of operations, employee benefits at Assured Neace Lukens in Louisville, Ky., said that brokers “should be making a concerted effort to get information” to employers.

“For smaller employers, the person handling benefits is often wearing multiple hats and has limited time to work on benefits on a day-to-day basis,” Hagan said. “So I do think it’s incumbent upon us to make sure that clients understand that we can provide resources to them, though sometimes with time constraints or business priorities, they may not always avail themselves to those services.”

Some clients don’t know how to ask for what they need, said Denise Ashford, vice president at Sweet & Baker Insurance Brokers in San Francisco.

“Sometimes brokers have the best intentions, but in fact, we don’t take the time to actually speak with the clients to diagnose what they are lacking, and that can send us down that rabbit hole of offering services they don’t need or care about,” said Ashford, who has surveyed clients to better target their needs.

Other survey results include:

• Nearly six in 10 (59 percent) employers are unsatisfied with the information they receive that could help reduce the frequency and expense of claims.

• Nearly two-thirds (63 percent) of employers are unsatisfied with their current broker’s assistance in creating benefit statements.

According to the survey, employers listed their top three risk management challenges as keeping up-to-date on regulatory changes, controlling workers’ compensation costs and educating employees about safety.

They ranked their top three employee benefit challenges as managing health care costs; keeping in compliance and up-to-date on changing legislation, including health care reform; and benefits administration and employee benefits education.

Katie Kuehner-Hebert is a freelance writer based in California. She has more than two decades of journalism experience and expertise in financial writing. She can be reached at [email protected]

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