The Great Resignation and the rise of the “solo-preneur” have changed the game for employees, employers and insurance. As a result of the Great Resignation, employers need to be more competitive with their insurance and benefits packages to attract and retain talent. Relatedly, “solo-preneurs” are shedding traditional jobs altogether to embrace the flexibility of freelancing or gig work. Whether switching jobs or striking out on their own, everyone would love the opportunity to take their employer-provided insurance with them throughout their life and career. Enter insurance portability.
Insurance portability, the ability to retain insurance and benefits products after you leave an employer, will be a huge part of the future of insurance. And although many insurance carriers and their employer clients don’t (or can’t) offer it now, they should consider it to stay competitive in the marketplace.
How insurance portability benefits employees, employers and carriers
Insurance portability gives employees a sense of security and cost savings and gives employers a competitive advantage. Employees or “solo-preneurs” like flexibility and work-life balance, but by leaving their job or striking out on their own, they lose access to benefits they’ve had in the past. Typically, benefits such as hospital indemnity, accident or life insurance stay with your employer when you leave, and in the U.S., you also lose your employer-provided health insurance. Insurance portability lets employees take those benefits with them and reduces their insurance costs. Plus, employees never have to start over with their benefits packages because of their age or health status. Employers can use insurance portability as a way to attract and retain talent for these reasons: when you leave our company, you can take your insurance/benefits products with you.
For insurance carriers, portability is both an attractive offering to their employer clients in terms of helping them attract and retain talent, and it can foster lifetime customer brand loyalty. A young employee, for instance, retains the same insurance over the course of their career as they age, and they’ll often reach out to the same carrier for other types of insurance throughout their life (we’ll cover the loyalty aspect in-depth later in our blog series, but just think of the lifetime value of this new customer).
What technology is needed for insurance portability?
So how can carriers make insurance portability a reality? They need a modular software platform that can enable portability and transformation without a lot of manual touchpoints, and manage multiple lines of business in one place. They also need a system that’s robust enough to house these different types of products at scale. That’s where a lot of technology falls short. To handle a 300,000-employee case and be able to port that information over and convert it from group to individual, carriers need a robust rules engine, an automation system and workflow to easily change the billing structure and send out a new policy automatically. Otherwise, it’s troublesome to manage from the carrier’s perspective. Having such a system won’t add more work for them.
To provide a good customer and employee experience, carriers also should look for a platform that has open APIs and is in the cloud, automated, seamless and lean. Portability is not cumbersome and shouldn’t be costly.
As today’s employees embrace more flexible work options, employers and carriers need to be equipped for it. Insurance portability allows them to meet customer demands in a new way. It lets employees carry their insurance with them throughout their lives and ensures that the growing gap in insurance ownership gets smaller, not larger. It lets employers attract and retain talent. It allows carriers not to lose market share and to foster long-term brand loyalty and lifetime value. Basically, insurance portability is a win-win-win and will be a huge part of the future of insurance. Is your company equipped to take advantage of it?
Find out how EIS enables insurance portability. Book a call today.