Group Insurance Quotes

I've been busy running quotes for a few new group clients, as well as marketing a few existing groups to ensure prices are competitive. This hasn't left a lot of time for blogging. So I thought I would just post the stuff I have been working on. Below you will find a quote comparison for a group of mine, name removed for privacy. The group is currently with Benefits By Design, they are getting a 13% increase in their renewal rates, which I think is somewhat unjustified. So I have marketed the group to a number of carriers, I have included 5 in the comparison (Manulife, Equitable Life, Sun Life, Wawanesa and Great West Life). I have worked with all of these carriers and have confidence in the service and support they provide. As you can see the rates do vary from carrier to carrier, with Great West Life being the most expensive, though still providing a savings over BBD's original renewal. Manulife looks artificially cheap because they declined to quote on Long Term Disability for this group, we would need to add about $600 or so, to their premium, involve another carrier, possibly double up on some Life Insurance etc. so they have been eliminated from the running.

Sun Life is next in line, they are actually providing a savings of $278 per month over what the group is currently paying. This concerns me slightly as I think this is too cheap, I believe there is some heavy discounting going on here and that at next renewal there will be a corresponding increase. If the client is ok with the fact that next renewal will be high, than I have no problem taking the discount, but the client has to be aware of what they are getting into.

Equitable Life looks pretty good, both rates and efficiency wise. You will notice under health and dental the Target Loss Ratio (TLR) field. These number show how much of the premium is directed to claims and how much goes to admin. Ideally you want higher TLR's as this provide more money to pay claims, and less to overhead. Equitable is running 77.8% for health and 78.8% for Dental, this is far better than the current 73.4% and 75% BBD is providing. Wawanesa is the most efficient at 79.7% for both Health and Dental.

A Good example for looking at TLR efficiency is to compare the Health Care rates of Wawanesa with Manulife. Manulife has the less expensive premium of $2069 for health care, but also a lower TLR of 76%. Wawanesa looks more expensive at $2344 but has a higher TLR of 79.7%. When you compare dollars to dollars,

Manulife comes up with $1572 directed to claims and $497 in admin.
Meanwhile
Wawanesa comes up with $1868 directed to claims and $476 in admin.

So while Manulife "looks" cheaper on the surface, Wawanesa will pay more claims, and also charges a little less in admin. At the end of the day having more money funneled to claims means better renewals and more stable premiums.

Assuming the client is comfortable with a sizable renewal next year I would be recommending Sun Life for a combination of best premium, meeting the plan design requirements, as well as having good service and support. If the client isn't comfortable with the idea of a large renewal then my fallback position would be Equitable Life.