For our fourth episode, we sat down with Dick Mucci, former Lincoln Financial Group Protection President, to talk about the dynamics employers are facing with group benefits as we move into 2021. In this wide-ranging conversation, we covered both where group benefits have been historically and where they need to go in 2021 in light of changing employee needs.
The problems we face in group benefits
We started by asking Dick why he joined Brella’s corporate advisor board. He gave a really concise summary of the challenges and the urgent needs we face together as insurance companies, benefits advisors, and employers when it comes to protecting employees.
“There is a crying need for insurance coverage for rank and file Americans... I’ve seen too many situations where a family suffers a premature death or someone gets sick or hurt and families suffer, people lose their homes, kids don’t get educated, and we as Americans tend to sweep that under the rug. We don’t pay attention to it until it’s too late. So our mission as an industry is to do a better job of providing protection to Americans first by having them understand the risk and the options they have, and to deliver those options in a very efficient way that’s customer satisfying. Brella is a company that’s making inroads with that type of thinking.”
It’s not enough simply to design better group benefits, they need to be communicated clearly and deliver benefits efficiently. Dick cites Brella’s simpler claims workflow and fast payments as one example of what this looks like.
The history of group benefits
Group benefits first became prevalent in the U.S. after WWII as employers were looking to attract and retain the best employees. Employees at that time didn’t have much choice, but these benefits were appreciated and it’s become embedded in our culture in the U.S. more so than in other countries around the world.
When Dick joined the insurance business in the mid 1970’s, healthcare costs started to increase. Over the years as costs continued to rise, premiums rose, which lead to higher deductibles and increased cost sharing to the point that employers couldn’t afford to cover all the premiums and employees had to contribute more. To keep their benefits package attractive, employers added a wider variety of benefits like dental and life insurance, which were well received.
Over the years, employees became more focused on their benefits. Not only were there complex choices they needed to make to elect their benefits, but also they were increasingly responsible for sharing the cost of these benefits with their employer.
Where will group benefits go in 2021 and beyond?
With the high cost of healthcare comes huge risks for the average American family. Group Benefits are in a position to protect those families if insurance companies, brokers, and employers embrace products that offer the protection today’s employees need. Here are the trends Dick sees driving necessary change in 2021 and beyond.
Trend #1: Changing demographics are driving a need for diverse benefit offerings.
Today’s employees have a wide variety of family structures and they’re retiring later. Employees may be childless and unmarried. They may be Gen-X, Y, or Z. They may be caring for kids and aging parents. These dynamics create a wider variety of needs when it comes to employee benefits than we’ve ever seen before, both in terms of the plans themselves, and how to communicate with those employees about their coverage.
“We need to have more tailoring of insurance programs to better meet the diverse needs of the consumer.”
Trend #2: Consumers want guidance.
With the plethora of choices available and the option to customize benefits to their needs, this creates a huge need for employee education and guidance. Given the tremendous health crisis we’re facing in our country, consumers are more aware of their risk than ever before—health risk, life risk, unable to work risk—so they’re looking for someone to help them sort that out.
In research he conducted, Dick saw firsthand that employees who are worried about their financial situation are more stressed, more likely to be absent from work, and less productive overall. This is a huge motivation for employers to keep their benefit programs up to speed with the current needs so that employees can do their best work.
Trend #3: Employers need guidance.
In light of the diversity of products, and the heightened level of risk, the role of the broker has become more important than ever. At the beginning of the pandemic, many employers hesitated to make changes to their benefit offerings, but there’s an opportunity now to bring on new benefits, even through off-cycle enrollments to meet employee’s concerns.
Listen to the full episode to hear Dick’s recommendations of new products brokers should be looking at in 2021.
Dick’s leadership resources
If you’re going to lead a group of people, leadership traits are really important, so Dick has studied leadership for years as he grew as a manager of global insurance businesses. While he recommends reading about any leader who’s gone through stressful situations, he especially recommends:
- Team of Rivals: The Political Genius of Abraham Lincoln by Doris Kearns Goodwin
- Truman, by David McCullough
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