As a small IFA, I have recently redirected my business towards the SME group market. I am finding clients are obsessed with the price alone. Should I make an effort to sell on the added value of these products, such as EAPs, or should I just concentrate on price?
Intermediaries should be careful to avoid exposing the client – and therefore themselves – to unnecessary business risks. They should ensure the contract the client is entering is understood by themselves and the client.
And, if it is an existing scheme that is moving insurer, intermediaries should check there are no gaps in cover between the former insurer’s cover ceasing and the new one’s beginning; for example, through the operation of ‘actively at work’ conditions. The nightmare scenario is discovering a gap only through having a submitted claim rejected.
Paul Avis, Canada Life
There are many challenges, and costs, associated with running an SME, so most definitely a complete understanding is needed to provide a rounded solution for employers. This does not just mean a consideration of price.
Many may have legal services support through local solicitors or outsourced fee-based organisations. So, the ability to run staff handbooks, contracts of employment, H&S programmes online and get legal telephone support through insured schemes can reduce third-party costs.
EAPs, helping employers meet the 1974 H&S legislation for ‘duty of care’, are integral to many group schemes but stand alone policies can cost around £15 per capita.
Bereavement and probate lines, available on some life schemes, depersonalise difficult people situations that SME owners/managers face at times of crisis.
Health scenarios can be very emotive and some insurers have developed support to help employers aid their employees’ successful return to work.
Investing in private medical and cash plans can be done, perhaps to minimise absence, and increase clinical certainty through a second diagnosis service to keep premiums in check. The ability to support employees in difficult times is particularly important in tight-knit SME workforces, where people have often worked and grown the business together over a long time.
Consultancy reviews between the current provisions and insurer offerings may provide fee opportunities and save clients’ money in the process. Intermediaries should ensure a full understanding of the employer in order to advise on the best solution with the best insurer fit.
