Banks and other financial services providers are enhancing the customer service features in their group employee benefits offerings, according to industry watchers.
As employers look to combat rising benefits costs by outsourcing, many are seeking higher levels of customer service from plan providers, said Christopher Drew, a vice president of life product management at Prudential Financial Inc., the Newark, N.J., insurance giant.
And a study released Monday by Prudential says that 77% of plan sponsors prefer superior service at a competitive price to the lowest possible premiums.
Employers are “looking to third-party administrators and others to take human resources administration out of their operations and put it somewhere else,” Mr. Drew said. And Prudential and other companies are building services to address this trend, he said.
Hartford Financial Services Group Inc. has also seen a movement toward benefits administration outsourcing, said Brian Neary, a vice president of customer service and relationship management at the big Hartford, Conn., insurer.
“Employers have less time and resources available to them,” Mr. Neary said. Ancillary products such as disability insurance may be particularly confusing for overwhelmed human resources workers, he said.
The trend toward human resources outsourcing may compel banks to boost their customer service offerings for group benefits products, said Michael D. White, the president of a bank-insurance consulting firm, Michael White Associates, in Radnor, Pa. Some banks have already done so by purchasing large commercial insurance agencies that include employee benefits shops, he said.
Banks may also look to add group benefits products with extensive customer service features to their retail platforms, he added.
Plan providers need to step in to supply the administrative capabilities that employers themselves lack, Mr. Drew said. Many plan sponsors need assistance with benefits enrollment, for example, he said.
Employers are also looking for providers who can quickly and effectively execute basic administrative tasks, such as processing claims and evidence of insurability, Mr. Drew said.
Providers “need to be doing the fundamentals well and doing all of them right,” he said. “They need to execute basic blocking and tackling flawlessly.” Prudential sets clearly defined goals for its administrative services, including 99% accuracy in claims processing and turning around evidence of insurability within five days, he added.
Plan providers should also have a dedicated client management team to respond to any question or concern brought to them by employers about their group benefits plans, Mr. Drew said.
Like Prudential, Hartford has intensified its focus on customer service for group benefits products during the past two years, Mr. Neary said. The company surveys employers and claimants to determine whether clients are satisfied with the insurer’s customer service response and whether additional services are needed, he said.
In recent months, Hartford has concentrated on improving its Internet-based customer service and administrative capabilities, according to Mr. Neary. Employers can manage all aspects of their life and disability plans online, including billing, reporting, plan documents, and premium remittance.
Hartford has also expanded its customer service offerings for employees, particularly as employee benefits become more consumer-driven, he said. Through thehartfordatwork.com, employees can get access to information about different sorts of insurance coverage, including disability and life.
Employees can also have access to their accounts, submit claims, and check the status of claims through the Web site. It also features a benefits calculator that helps people decide which benefits are most appropriate for them.
