With more and more Canadians self-employed or working in contract positions, living benefits should be a priority, says The Edge Benefits head
According to The Edge Benefits president and CEO Neil Patton, many financial advisors and insurance brokers are neglecting to discuss living benefits with their clients. With more and more Canadians now self-employed or contract workers, it’s a dangerous oversight and one that needs to be addressed, he says.
“Statistics indicate that only around 6 per cent of them actually engage in a living benefits conversation with their clients,” he says. “The industry has a lot of complexity in the products, so brokers shy away from them.”
The Edge Benefits markets itself as Canada's Lifestyle Protection Company, specializing in the growing market of workers that are not eligible for a traditional employee benefits plan. The firm develops products tailored specifically for those individuals, and with over 45,000 policyholders, it has paid out in excess of $100 million in benefit claims in the last decade.
In operation for over 30 years now, the company recently signed an exclusive national distribution alliance with five leading MGAs – Customplan Financial Advisors, Financial Horizons, Hub Financial, IDC Worldsource, and PPI Solutions. The deal expands its distribution reach to over 75,000 advisors, which in turn should mean significant growth in its customer base. As Paton explains, however, work is needed to educate advisors and brokers on the merits of these products.
“If a business has 300 employees and 100 contract workers, the 100 contract workers are excluded,” he says. “Our opportunity is to change that and get in front of those contract workers. We are working on a few different projects right now, using technology to reach these people. Unfortunately, there are a lot of people that don’t have an insurance advisor, and if they do, that advisor is not talking about living benefits, which can be critical if you are self-employed.”
In order to make living benefits a more attractive proposition, The Edge Benefits head believes simplicity is key. Remove a lot of the complexity associated with these products, and the inherent value will soon become crystal clear, he argues.
“We simplify these products – the quality is still there, but they are easier to understand,” says Patton. “For example, for a small business owner we would offer benefits based on gross revenue instead of earned income. If someone makes $100,000, then writes it off, they would have net earned income of around $25,000. That would allow them benefits of about $1,000 of disability, but the way we calculate you could get $3,000. We are changing the way living benefits are offered.”
Related stories:
Brokers need to think beyond the sale to ensure credibility, says benefit plan specialist
Working millennials seek more flexible benefit plans
“Statistics indicate that only around 6 per cent of them actually engage in a living benefits conversation with their clients,” he says. “The industry has a lot of complexity in the products, so brokers shy away from them.”
The Edge Benefits markets itself as Canada's Lifestyle Protection Company, specializing in the growing market of workers that are not eligible for a traditional employee benefits plan. The firm develops products tailored specifically for those individuals, and with over 45,000 policyholders, it has paid out in excess of $100 million in benefit claims in the last decade.
In operation for over 30 years now, the company recently signed an exclusive national distribution alliance with five leading MGAs – Customplan Financial Advisors, Financial Horizons, Hub Financial, IDC Worldsource, and PPI Solutions. The deal expands its distribution reach to over 75,000 advisors, which in turn should mean significant growth in its customer base. As Paton explains, however, work is needed to educate advisors and brokers on the merits of these products.
“If a business has 300 employees and 100 contract workers, the 100 contract workers are excluded,” he says. “Our opportunity is to change that and get in front of those contract workers. We are working on a few different projects right now, using technology to reach these people. Unfortunately, there are a lot of people that don’t have an insurance advisor, and if they do, that advisor is not talking about living benefits, which can be critical if you are self-employed.”
In order to make living benefits a more attractive proposition, The Edge Benefits head believes simplicity is key. Remove a lot of the complexity associated with these products, and the inherent value will soon become crystal clear, he argues.
“We simplify these products – the quality is still there, but they are easier to understand,” says Patton. “For example, for a small business owner we would offer benefits based on gross revenue instead of earned income. If someone makes $100,000, then writes it off, they would have net earned income of around $25,000. That would allow them benefits of about $1,000 of disability, but the way we calculate you could get $3,000. We are changing the way living benefits are offered.”
Related stories:
Brokers need to think beyond the sale to ensure credibility, says benefit plan specialist
Working millennials seek more flexible benefit plans
