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Client Service September 15, 2023
Addressing Total Benefits Requires Multiple Perspectives
As plan advisers become more involved in the total benefits experience, they should seek out an employee benefits broker, said experts at the PLANADVSER National Conference.
Reported by Natalie Lin
Retirement plan advisers are increasingly being asked to do more than just retirement plan advising as plan sponsors seek help with the total benefits experience for their participants. Experts at the PLANADVISER National Conference discussed total benefits and the service model opportunities for advisers to get involved.
Participant engagement is both needed and valued by employers and employees during pivotal life events, Adam Johnson, regional vice president with John Hancock retirement plan services, told an audience of advisers in Scottdale, Arizona.
“Having a session for new moms, why does that matter? That’s a specific life event. There’s money in motion, there’s changes in motion, and so that’s a time when we know that people need help,” Johnson said. “There are other times that we know they need help. We know that they need help when they hit a certain age.”
Johnson noted that not all employers value the financial wellness curriculum in the same way, so it is important for an adviser to provide an offer and get engagement back from that plan sponsor.
“We’ve all been in that situation where we want financial wellness to work, we’re doing the work, we’re sitting down, but we don’t have that top-down support,” he says. “I think that’s the first thing. You have to have [financial wellness] as part of your proposition, but you also have to understand where to best utilize your time and your resources.”
To emphasize to an employer how better retirement outcomes will help the total benefits picture, Johnson said advisers should provide employers with data from a benefits broker involved in health care, because the broker has a wider perspective on what type of behavior participants are experiencing.
“They have very good data on that, and so I think two things are important,” Johnson said “One: if you’re able to have that true partnership, whether you’re both in the same firm or whether you’re sharing a relationship with somebody, [it’s important] that you’re able to have that conversation together. I think that’s really powerful. I think most advisers miss the opportunity to have that conversation.”
Second, he said, is to analyze data in the recordkeeping system and understand the participant experience based on tenure or other factors.
“It isn’t necessarily bad if the plan as a whole is doing great,” he said. “But if all of my young employees are on track to retire because we adopted auto-enroll 10 years ago, but all of my older employees are falling behind that, that’s a clear and obvious opportunity.”
Health care costs are having an impact on benefit needs as well, said Mike Kane, the managing director of Plan Sponsor Consultants, a Hub International company. According to Kane, variable claim costs for any health care plan are based on price multiplied by utilization, so addressing those two components are critical. Cost control measures include price and utilization tools for not only the insurance carriers, but for the employer as well, Kane said, so the “generosity of the employer” can help.
“I would suggest that even if you have minimal interest in what’s going on with these escalating health care costs, you ought to least Google and read about what’s going on,” he said. “You can seek out and have a relationship with an employee benefits broker or property and casualty broker because you both can benefit from referrals.”
Kane also noted the advantage of having the benefits broker learn more about retirement advisement.
