The value of group protection hasn’t changed. The need for people to protect their life, their ability to earn an income and to keep a roof over their heads remains. What has changed are employer and employee expectations and needs. Employees now have greater expectations of their employer when it comes to supporting health, wealth and happiness. And employers have a much greater need to drive better value from benefits and services as part of a wider workplace wellbeing and engagement ecosystem. It’s with all of this in mind that we recently set course to reimagine group protection.
Here are the key challenges as we see them:
- To ensure products and services appeal to the mass market. The protection gap of unmet needs in the UK remains stubbornly huge.1 We need to take lessons from big tech when it comes to meeting customer needs in terms of products that are: easy to use, engaging, personalised, cost effective, reliable and relevant.
- To elevate the discussion beyond product and price to outcomes. As an industry, there’s been much discussion over recent years about the shift from insurer to service provider. This will only be born out in practice when we all stop thinking, first and foremost, like insurers and take a ‘service provider first’ mindset.
- To work in partnership – providers, intermediaries and clients. To unlock and integrate data sources to help ensure greater cost efficiencies and improved wellbeing and engagement (i.e. early intervention, return to work, benefit programmes and communication tailored to need).
Tackling these challenges starts with a rethink of some elements of the core product. The insurance. While still offering valuable peace of mind, its traditional focus on salary multiples doesn’t help meet individual needs. What’s needed is personalisation; allowing policyholders to dial up and dial down cover across life, income protection and critical illness cover. And not just during a once-a-year Flex window. Access should be anytime, easy and mobile-first.
Next, learnings from retail insurance. With ‘individual’ style upfront digital medical underwriting, we can bring more claims certainty to the group space. Plus, cover arranged in minutes and generally no medicals required. Of course, the scale and efficiencies of group also bring advantages, in the shape of very cost-effective cover where voluntary benefits are concerned.
Value of voluntary
At a time when employers need to make even greater cost efficiencies as a result of the Covid- 19 pandemic and perhaps don’t have the budget for benefits – or have core benefits but want to introduce more choice, flexibility and personalisation – the introduction of voluntary benefits could prove invaluable.
There’s a considerable opportunity to help employers promote the advantages to individuals of buying via the workplace. Not only is it more cost effective than the retail market, it’s also friction-free. No need for lengthy online form filling on comparison portals, only to be hounded by salespeople after finally obtaining a quote.
However, voluntary will live or die by the strength of the employee communication support.
Finally, it’s time to flip the whole protection package on its head. Wellbeing / early intervention services first. Insurance second. Success here requires trust and collaboration with regards to data sharing.
Not only that, but the lack of HR support with regards to communication and engagement is impeding opportunities for employees to better understand – and use – the services to which they have immediate access.
That’s why we’re also now looking to better equip HR to communicate in a more targeted and relevant way instead of leaving them with a brochure and a “good luck” message. This involves education and practical support for employers on how to get their messages across in a purpose-led way as part of a wider wellbeing and engagement strategy. Doing this will help elevate group protection beyond a set of standalone products to more valued, integrated components of a self-care culture.
Group protection might not be broken. But it does seem to have hit the proverbial brick wall. But through innovation and collaboration, insurers and intermediaries have a real opportunity to grow this market.
We’re now in a situation where 10 million people have experienced the largest income protection scheme the world has ever seen in the shape of furlough. But, still, pointing out to people and business the potential dangers of not protecting income – and leaving it at that – will only serve as a turn-off to most. It’s time for change.