Employer focus
Group life cost saving strategies
Given that the economy is still uncertain, employers continue to work diligently to find ways to cut costs and improve their bottom line. At the same time, HR executives are trying to find ways to keep benefits packages competitive to attract and retain talent as the economy rebounds.
Group life insurers who partner with their clients to develop creative solutions have come up with several strategies for reducing the cost of group life insurance programs.
Some of these strategies include:
- Removing waiver of premium from basic life
- Adding age reductions to basic life
- Freezing retiree life coverage or arranging a buyout
- Adding portability to basic life to reduce conversion charges
- Replacing basic Accidental Death and Dismemberment (AD&D) with Voluntary AD&D
The surprising result: not only can these changes reduce premium by 5 percent or more, but also instead of eliminating or reducing the benefit, the plan actually can be enhanced. Minnesota Life, a company that ranks among the largest group life insurers in the country, recently helped two clients realize substantial savings by making a plan modification. By removing waiver of premium, Client A saw a 5.1 percent decrease in premium for its basic and supplemental coverage; Client B had a 6.4 percent decrease in premium.
Let us help you evaluate your life insurance plan and recommend plan design and pricing strategies to achieve both your cost savings and benefit enhancement goals. Contact your regional group sales manager or client relationship advisor.
