Wednesday, March 21, 2007

A Good Group Guy is Hard to Find

I started in the insurance business as a group sales representative trainee for Union Mutual Insurance Company. Fresh out of Texas A & M one of the attractions the job held was an extensive paid training program. I spent 9 months in training, including 10 weeks in the classroom learning group insurance before I was allowed to make a sales call.

Trainees were required to know how to assess risk and underwrite group insurance before interacting with the public. We were drilled in the classroom and by more experienced senior sales representatives on the contractual terms associated with Group Health, Dental, Life & Disability contracts. We were expected to be technical product experts for all the group insurance products sold by Union Mutual. Since Long Term Disability (LTD) was our lead product, and law firms were our primary target market I cut my teeth as a trainee explaining the contractual nuances of the LTD contract to attorneys as a 22 year old rookie rep.

Expertise was critical since most of our customers were either property casualty brokers or life insurance agents who relied on "The Group Guy" for counsel. Companies like The Travelers, AETNA, Connecticut General and Union Mutual had legendary group schools just like the one I attended. In every individual or P&C agency there was a group guy who handled the employee benefits.Most of them were graduates of the old group schools who moved on to the dark side and are brokers and consultants operating at the retail level and servicing their employer clients. That's what I did in 2004. Today I answer only to my God, my wife and my clients, in that order by the way.

Over the last 20 years training departments have been largely eliminated by most insurance companies. Some insurers rely almost exclusively on life experienced hires for their group sales force. Many Insurance Companies with training programs are simply providing their sales force with rudimentary scripts and point of sale materials. Good luck getting an answer to a question that's not covered in the FAQ'S!

What is even scarier is many of the group representatives who have moved into retail over the last 5-10 years are now advising clients. They dress nice, are usually polished, handsome or attractive. They can prevent a spreadsheet and focus an employer on the low cost alternatives available. Most of them do not make recommendations. Proverbs provides counsel "By their fruits you will know them". Ask a few questions that are not part of their presentation or script If you ask for a recommendation and are steered to the low cost provider ask a few more. How did the carriers arrive at their premiums? Why do the premiums vary so much? What premium level is sustainable? Which funding alternative is right for my company for each product--insured or self insured? What are the salient differences in contractual terms? Is the premium fair? What should the renewal premium be? Is the plan design appropriate and aligned with the employers objectives? What type of service should be expected? How does the service compare? Should multiple products be placed with one carrier or unbundled for best in class contractual terms and cost? Who will represent the employer when a problem occurs? Will I be dealing with you or your service rep or will I be supported by an call center? Who will enroll employees and answer their questions? A group guy can answer these questions quickly and concisely. They do not need to look up the answers if they prepared. Anyone who cannot answer your questions is an impostor. I encourage every employer to get granular when evaluating a broker or consultant. Find out if you are dealing with a group guy or an impostor. Here is a hint though; The person who shows up with a spreadsheet and a legal pad and answers all your questions without referring to either--that's a group guy.

At a funeral recently of another legendary group guy (Travelers Group School Graduate by the way), who died way to soon, I listened to eulogy's from a number of clients who spoke of the immense respect they held for a man who had counseled them for years. There were quite a few old school group guys in the audience and many had gone to group school for months. There were also a number of younger group reps who called on the group guy. One of the younger group reps commented afterward it was amazing to such lifelong friendships all came out one group school. I realized this individuals group school might have lasted a week or two. He had no frame of reference for the old group schools which often involved months of intensive classroom training. I realized Group Guys are becoming rarer. There are very few true group guys blogging.

I am a Group Guy. I know a number of Group Gal's including my mentor by the way so consider the term unisex. My business is founded on providing counsel to my employee benefit clients rooted in integrity, experience and independence. In this blog I intend to share my candid thoughts on matters of interest to me within the Life, Health and Employee Benefits space that deserve commentary and incisive analysis.

I am weary of the spin being churned out and regurgitated from a script by some insurance companies, brokers & consultants and intend to expose frauds by goring a few oxen that are desperately in need of a bloodletting.

My style is blunt. Heck, I was an offensive lineman as a young man and I still enjoy a good pancake block. Besides, there are a number of bright young group reps out there who do not have the benefit of counsel from gray haired group guys like I did as a rookie who can still turn into group professionals with proper guidance. Who else is going to provide them with perspective and entertain them with war stories from the trenches from the days we calculated rates with a pencil and a legal pad? Who will provide counsel for the business owner forced to choose between an annual profit or dropping the health insurance that has become unaffordable? I will. I am The Group Guy.

Let the games begin.

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