The employee benefits market is highly complex and rife with inefficiencies. On the path between providers and customers lie brokers, software platforms, and HR departments, to name a few, each with their own priorities and costs. With every intermediary taking their cut–whether from commissions, service fees, or administrative overhead–over a third of the premium dollar may be lost to non-coverage-related spending.
The persistent margin leaks
Unfortunately, the inefficiencies within the benefits market are not a new problem–and innovation in the industry has been largely stagnant over the past decade. Perhaps due to the difficulties stemming from high complexity and regulation or the lack of sufficient data integration leading to silos, benefits have not seen the innovation that other financial services industries have.
But advancements are long overdue. Benefits companies must decide how best to streamline the ecosystem between carriers and beneficiaries without compromising overall effectiveness to lead in this industry in the coming decade.
Mitigating inefficiencies in the benefits ecosystem
Providers have a variety of avenues through which to streamline their go-to-market process and offerings:
Leveraging a team dedicated to the innovation of the benefits ecosystem will facilitate a more painless integration process, regardless of approach.
Innovating towards a consolidated future
In an industry bogged down in complexities and intermediation, heightened integration is key, and there hasn’t been a better time than now. Technology is more capable than ever, including more powerful AI and more complex software integrations. Companies that can establish streamlined processes that limit margin leaks without degrading consumer value will remain relevant in this highly competitive industry.
For more information on how providers can innovate their go-to-market strategy to be strong players in the employee benefits space in the coming decade, read our whitepaper: “A new golden age for employee benefits.”
Download the whitepaper, “A new golden age for employee benefits”
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