In a recent article titled ‘5 Questions to Ask When Choosing Your Employee Benefits Consultant’, I provided some go-to questions for companies that want to hire a benefits consultant. But what if an organization already has a benefits plan consultant? Should they look around or stick with them? Once the company is happy with the service provided, there should be no reason to shop for another broker. However, some customers are left wondering: Is the grass greener on the other side?
Well, like any industry, there are range of people and businesses that call themselves employee benefits ‘consultants’ and an organization should be mindful of what they are potentially walking into. Here are the top 5 ‘brokers’ to be weary of, should an organization decide to look around for another broker.
The Top 5 Employee Benefits Brokers to Avoid
1. The on-the-cheap broker – This is the broker who promises to save a company tons of money on an existing employee benefits plan. They will smile, and explain how, they alone, can significantly cut the benefits plan costs. Sometimes, they will even show the company the potential premium savings. The fact is, they are probably not lying. But what they fail to tell the organization is that this savings will only be within the first year, and that eventually, the insurance company will make its money back on next year’s renewal when concrete numbers justify a big increase in the premium. If a company has concerns whether it is paying too much, ask the existing benefits consultant to shop the plan.
2. The semi-retired broker – This is the broker who is eager to win business at the start and likely shows a great track record with many years in the industry and offers a few big-name clients as references. They meet with the company’s contact in person who feels comfortable enlisting their services because of the knowledge and experience they have accumulated. But don’t be fooled. In some cases, this can also be the broker who is sipping cocktails on the beach in a favourite sunny destination, counting down the days until full retirement. Why could that matter? Because while their eagerness might initially be convincing, an organization might find it hard getting their consultant’s attention when questions need to be answered or concerns need to be addressed. In other words, they might not be fully invested in their work anymore and the company will receive minimal support.
3. The one-man-show broker – This is the broker who likely has very good intentions, but might not have the time to fully support their clients. They work alone, handle all the requests by themselves and do not have the capacity to regularly follow-up with their clients, monitor all the benefits plans to avoid raising premiums or even answer questions. Similarly, they might not have any strategic partners with complementary service providers that will improve the service realm of their clients. In others words, an organization would be settling for sub-par service with this type of broker.
4. The I-do-it-all broker – This is the broker who says they can handle your RRSP plans, employee benefits plans, life insurance plans and everything else under the sun. Maybe they have sold life insurance their entire career, and they are also an employee benefits plan specialist; or maybe not. Much like a one-stop-shop, you cannot expect expert advice or service on benefits plans from someone who is dabbles in everything. This broker might also have ulterior motives, acquiring clients with benefits plans in hopes of gaining bigger commissions from corporate life insurance plans. The constant persistence for more could become a nuisance rather than an advantage.
5. The self-centered broker – This is the consultant that only has their own best interest in mind, counting the pennies on the commission they accumulate every month. They will say and do anything to win your business but ultimately, they are selling you empty promises. Year upon year, this broker is focused solely on resigning the contract, and nothing else. They have no interest in overextending themselves to fight insurance companies on your behalf, or to aggressively negotiate to your reduce premiums; what they are concerned about is their own bottom line, period.
Looking for a new benefits consultant due to the allure of savings, more experience or better service can be appealing to some organizations, but it is important to know that the grass might not be greener on the other side. Consultants, whether experts and professionals with added-value services and support, or any of the above, all receive the same standard commission as a compensation for their services. So, if you are going to enlist anyone to manage your employee benefits plan, wouldn’t it make sense to stick with the best? Read about the BenefitDeck 5-point brand promise. We raise the bar in our industry, so that you and your employees benefit.
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