group term life enrollment trends for 2014
DESCRIPTION
Current trends in Group Term Life Enrollment based on Gen Re's U.S. Group Term Life Rate and Risk Management Survey as well as insights shared by participants during breakouts held on a variety of related topics – Enrollment, Employer/Employee Dollars, and Mortality and Exchanges. Read the full blog post here: http://www.genre.com/knowledge/blog/group-term-life-enrollment-trends-for-2014.htmlTRANSCRIPT
Group Term Life
Feedback from the Gen Re survey and roundtable discussions
Enrollment Trends For 2014
Thoughts on Open Enrollment
in the U.S.:
Definition varies in the market
true open enrollment
Modified open enrollment
Open enrollment is used to maximize participation, particularly with multiple voluntary products.
There is a greater possibility of open enrollment with smaller groups or cases.
There is pressure to offer open enrollments on in-force business; if those clients were to switch carriers,
they would likely be offered the option of open enrollment.
Even for in-force enrollments, it is very rare for a group to have the systems or tracking information
to be able to produce a list of previously-declined employees.
Group Life Enrollment Practices
Minimum Participation Requirements
Continue
When participation is low (or not met) the carrier feels like they are limited in terms of recourse.
Waive participation requirements and proceed with implementing the deal as is
2 1
3
Revert to fully-underwritten requirements
Handle enforcement on a case-by-case basis
When participation is low (or not met) the carrier feels like they are limited in terms of recourse.
Enroll sold products in different enrollment cycles
5
6 4 Impose penalties and/or enforce conditions Examples: Require employer to contribute more toward the basic employer paid rate
Have all employees complete an application up front - waive if participation is met or process the apps if not
Reduce multi-year rate guarantee period
Hold a follow-up enrollment (e.g., in 6 months or within first year)
Though the “textbook” scenario may call for walking away from the deal, in real life the carrier will most likely not reject the case. Bottom Line
Continue
Carriers may decide to waive minimum participation requirements, based on:
Carriers may decide to waive minimum participation requirements, based on:
A carrier's concern for participation from a business perspective is different than
the employer's concern from a Human Resources perspective.
*Source: Gen Re/Spring Group Voluntary Pulse Survey
get more volume Give more options
Carrier HR
To improve participation levels, carriers may:
Stipulate method of enrollment, e.g., face-to-face
Use carrier's enrollment team
Analyze case demographics up front to develop enrollment strategy Use web-based, "Avatar"-type educational technology
Phase additional products year-by-year vs. overload in year one
Leverage the involvement of payroll company
Set clear expectations with sales force to instill accountability for following through with low participation consequences
Survey Results Standard Enrollment Practices for a Takeover Case
Voluntary Group Life Insurance
Low Participation Group - 39% said they would require Evidence of
Insurability (EOI) for any new amount.
High Participation Group - 50% of respondents said they were more willing to
waive the EOI for any new amount.
Only 6% of respondents were willing to waive EOI for one-level increases.
39% 50% 6%
Survey Results Standard Enrollment Practices for a Takeover Case
Supplemental Group Life Insurance
Anti-selection concerns with the removal of EOI at enrollment are greater for groups with higher participation levels and individuals who have previously declined coverage.
Conclusion
Low Participation Group - 21% of respondents would allow a one-level increase
without EOI for those already participating.
High Participation Group - 11% of companies
allowed a one-level increase without EOI for those already participating.
No company allowed Supplemental Insurance for
new participants without EOI.
21% 11% 0%
Survey Results Enrollment Methods
Voluntary Life enrollees used the following methods to elect coverage:
2%
3%
3%
3% 3%
7%
4% 6%
9%
8%
14%
25%
26%
35%
32% 22%
25%
30%
0% 2%
1%
13%
2%
3% 65%
51%
51% 51%
52%
35% 0% 3%
3% 3%
4%
0% 2007
2008
2009
2010
2011
2013
Carrier’s Website Employer’s Website Group Enrollment Meetings
One-on-One Enrollment Sessions Paper Form Only Telephone
R=10
Over time, more employees are using the employer’s website and fewer employees are using paper forms. Utilization of telephone enrollment seems to have disappeared entirely.
Survey Results Spouse Coverage
Do you allow a spouse to enroll if the employee does not enroll?
R=18/19
Do you allow a spouse to purchase a higher amount than the employee?
Voluntary
Supplementary
Voluntary
Supplementary
28%
26%
17%
16%
72%
74%
83%
84%
To learn more about Group Term Life Reinsurance, contact:
Mike Fullerton p +1 207 347 4636
in /in/mfullerton1
To learn about additional enrollment trend research that Gen Re is planning and to determine whether your company should participate, please contact:
Marcy Updike p +1 207 347 4626
in /in/marcyupdike
© 2014 General Re Corporation | This presentation is intended to provide background information to our clients and professional staff. It is time sensitive and may need to be revised and updated periodically.