Employee Benefits

Beware the Cost Sales process!

Times are changing and businesses need to prepare for their premiums to rise.

We are sorry for being so blunt, but you would find out when the renewal landed, so you may as well be prepared!

Ever since the 2010 financial crisis, we have seen a race to the bottom on premiums, with salespeople simply offering to beat the renewal premium on their medical. There have been casualties along the way, with insurers entering and leaving the market as they were unable to maintain a sustainable business model. Thankfully, with one exception (and they know who they are), other insurers stepped in so customers were not left uncovered.

Just one look at a typical Group Life Assurance policy offering four times salary, for example, with a premium under £5,000 per year, only needs one claim for £100,000 to mean it will never be profitable for the insurer paying the claim! Remember, in most cases every employee gets cover with little or no medical evidence, so there are potentially some severe risks taken on.

This means underwriters must make sure they price their whole book in such a way that, over a given period, it does not lose them money. This applies to every type of policy.

On a Group Life Assurance like the one above, we believe rises in the region of 20% to 40% are possible, but before you run for the hills, even with that, they still provide extraordinary value for money and, in some cases, with benefit adjustment, some of these costs can be mitigated.

Against this backdrop, your choice of adviser is vital, and we believe those who are used to selling by Excel, will need to adopt a model like ours. We actively consult with our customers, and rather than being the one that sells them a policy once a year, we are a trusted business adviser able to demonstrate a return on the investment for their business.

Call Prosperis today for a free, no obligation consultation on 01423 223640 or email us below.