COVER and WSB recently undertook a live webinar in conjunction with Unum to ask whether the traditional relationship between employer, employee benefit consultants and insurers has changed to reflect the new reality of work. Here are some of the highlights from the webinar
Speaker key:
Fiona Murphy, editor of COVER magazine
Jonathan Stapleton, editor of WSandB
Liz Walker, head of HR, Unum
Michelle Bradshaw, compensation & benefits director at Oracle
Matthew Gregson, consulting director at Thomsons Online Benefits
Fiona Murphy: What are the issues that employee benefits consultants see with employers and workplace demographics?
Matthew Gregson: Employers are caught between a rock and a hard place because many employers now are facing the ageing population dilemma.
For us the real dilemma is that you've got vast swathes of the workforce that are now contemplating retirement but without any defined benefit to fall back on.
Defined contributions pensions haven't necessarily delivered the value over the last 15 years that has meant they can effectively plan retirement.
From a health and wellbeing perspective that's putting greater pressure on healthcare costs, absenteeism and other issues that ultimately impact the health and wellbeing strategy.
But employers can't rob Peter to pay Paul. They need to think about innovative ways to engage the younger workforce with their wellbeing, both to maintain their wellbeing long-term but also to see it as a reward for them while not taking, money or investment in time and ideas away from one area of the business to another.
Michelle Bradshaw: We have an ageing workforce, in spite of the fact that we're a tech company. Our average age is 46, so I agree that we do need to have a real focus on helping people to save for the future. The pension issue is huge and what's interesting is because people are working beyond retirement, people are living longer.
Even if you've built up a reasonable pension fund, you'll actually see that deplete over time if you look at the cost of care homes, for example. We put a big focus on wellbeing, not just health and fitness but we also look at financial wellbeing. In multi-generational workforces, it's important for employers to try to introduce as much flexibility as possible.
FM: Where can insurers help with the challenges that both EBCs and employers are seeing?
Liz Walker: It's around that balance of trying to please a broad set of employees with very different needs. We don't have a traditional workforce where a one size fits all benefits package works anymore.
We're trying to make sure that we have the breadth of products that has appeal across the employee lifecycle and to start to introduce some level of choice and making sure that those benefits are relevant to each employee in their own way.
With choice there is a lot of responsibility on the part of not just the employer but us as insurers and providers, as well as the EBCs and advisers to make sure that they're effectively communicated. There's an education piece there.
People trust their employers to make good decisions for them in terms of vetting the benefits that are available to them but there certainly is more than I think we can do as an industry together around communication and simplification.
If we ask people to make decisions or make sure that they have a benefits package that fits where they are in their life with some degree of choice, you need to make it simple.
We need to work on how we aggregate that and give a simple view to what people have because if you've different pieces all over the place with different insurers and providers, that's a lot of pressure on an employer and an adviser, to say how do we make this consumable in a relevant way?
This is so people will know what they have and it's not just trying to sort through how many passwords do I have for the various portals that I need to go to.
Jonathan Stapleton: To what extent are employers, providers and consultants focused on products rather than outcomes with employee benefits?
MG: I believe that we are focussed on products as opposed to outcome but the most demonstrable version of that is the fact that products haven't fundamentally changed in 15, 20 years. Your medical insurance and your income protection are essentially still the same products.
We've added things around the edge to try and provide more of a solution focus and to try look at outcomes but if you go to the healthcare providers, not many of them can articulate the return on investment from a healthcare product. With income protection, although the providers, can differentiate themselves well, it's probably more focussed on delivering the insurance and the impact of that insurance than it is the result.
MB: I want continued investment from the company in wellbeing but you do have a short-term view and a long-term view.
If you are changing behaviours now, in the younger workforce, the idea behind that is that you mitigate risk on future claims and this is something that I've been talking about for a long time but it's very difficult to measure that. I like to focus on things like the impact of a wellbeing programme on short-term absence, for example, because that can give you some tangible return on investment.
But the focus on outcomes versus product from an employer perspective, I think if we only ever focus on product, we'll never move because we're only focussing on what's there now. I challenge my advisers to go out to the insurers and actually look at the products, look at what we want to achieve, and I have to say that some of the insurers have been incredibly flexible for insurers. It is an industry that seems to be a little bit slow to adapt and change but I'm looking for the insurance markets to tailor their products to suit the needs of my particular business and I think we've been quite successful with that.
We get all of our providers and advisers in a room on a quarterly basis to talk about how each of their products form part of the employee experience and the employers' experience. I think that's a good way to understand how each of the benefits are working but also it's giving our providers an opportunity to collaborate and to innovate, and some of the outcomes of that have been direct referrals between one provider and another, which wouldn't have existed until this forum got together.
FM: Where are the gaps in relationship between employers and advisers?
MG: The biggest gap between all of us is getting to a point where we have the data that we can actually make informed decisions as opposed to from the gut or just out of blind faith.
Once you're into implementation and delivery mode, it's a fact that we don't always join up the processes particularly well. For the average employer and indeed for the average adviser, they focus on getting the right products in place and they feel the job is done, and then all of a sudden you start to see a lot of gaps appearing.
Either, you don't proactively communicate, not just the products but you offer and support around it well. Alternatively, when it comes to claiming there isn't a particularly well joined up occupational health or triage process to ensure that the individual's using the right products at the right times.
MB: It's about outcome and it's not about, just looking at what's available today and trying to retrofit that into what our outcomes are. I want to see advisers and consultants challenging the insurance markets, challenging the current status quo. For example, your typical income protection might run to retirement age and that's a traditional setup. I want my advisers to challenge and talk about future whilst obviously keeping an eye on value for money and making sure that we're not overpaying for the products that we currently have.
LW: We talked about products, new products earlier and how products haven't necessarily changed.
There are a lot of really great new products and innovative solutions that sit on the shelves because you can't compare them apples to apples to competition, and so a lot of advisers out there, will say ‘let me just get you a cheaper price for the same thing.'
And they build the business on that, and if you're going to do that you're never going to get to those different products because if you don't have something to spreadsheet it against you're never going to show it to a customer, rather than having a conversation.
