Prospecting for Group Health Business

Labman · 10-21-2009, 03:22 PM

I've only been in the business for about nine months and find that getting new groups is more difficult than I imagined. I spend a good bit of time cold calling but still not managing to get the number of appointments I'd like. How do you guys prospect for your group business? Thanks!

somarco · 10-21-2009, 04:15 PM

Group business has a very long gestation period depending on the size group. The larger the group the longer the wait for the payoff.

If you are walking and talking you can pick up small groups (under 5 lives) fairly quickly, especially by AOR if you can convince them they need to hire you. Larger groups, especially 25+ and even larger, can easily take years.

JustinUpright · 10-21-2009, 04:55 PM

What can an agent, that does group health, do to help meet the bills, during this gestation period?

somarco · 10-21-2009, 08:21 PM

Marry someone with money . . .

MedicarePlanSolutions · 10-22-2009, 01:15 AM

Originally Posted by somarco

Marry someone with money . . .

I think that's a great plan! Another option would be to market individual products and other products that pay out quicker and then slowly fill your book of business with the larger deals until you can focus on it 100%.

Full Throttle · 10-22-2009, 02:02 AM

Another option would be to take a more general approach when calling for an appointment, lay out the general areas in which you can help, then let them decide what they want to talk about from there (if anything). Besides the group health, you will uncover life, DI, and voluntary cases that can help smooth your cash flow over if you are on advanced commission contracts.

I personally cold called for health business for 3 years and had some success at it. How many contacts per week are you making with decision makers? It's not easy, but keep calling for appointments and write down the x-dates you get along the way.

If it weren't for all the legislative uncertainty, I would still be doing it. However, I finally decided there is no way I'm going to put that kind of sweat equity into that business if there is no guarantee the renewals will be available or profitable to me in ten to twenty years. I'll still write the business, I just can't convince myself to focus on it.

That being said, I actually enjoy being able to come in with a more comprehensive stance and it opens up all the 1 to 10 employee businesses as prospects who don't have group plans and get benefits through their spouse as prospects.

somarco · 10-22-2009, 04:47 PM

Calling on Mr (or Miss) Big is fine, but as many experienced agents know, you are missing the low hanging fruit.

Whether your goal is to write 5 life cases or 500 life cases it doesn't matter. It is going to take time.

I still believe the best way to get into these groups quickly is face to face. Not cold telemarketing. Not direct mail. Not networking.

All of these have merit but are slow, expensive and almost impossible to predict.

Walking and talking to as many people as you can, handing out business cards and flyers will sustain you while you are trying to decide what you want to be when you grow up.

There are plenty of R&F employees that need and want help with health insurance, life insurance, DI, etc. While you are trying to get thru to the owner you are missing folks who will buy today.

The only way to introduce yourself to these folks is face to face. Even if Mr/Miss Big isn't interested in what you have to offer, more often than not they will allow you to hand out or leave behind material that employees can pick up in their own time.

arnguy · 10-22-2009, 10:07 PM

Bob, pardon my ignorance, but what are R&F employees?

ABC · 10-22-2009, 11:37 PM

Originally Posted by Labman

I've only been in the business for about nine months and find that getting new groups is more difficult than I imagined. I spend a good bit of time cold calling but still not managing to get the number of appointments I'd like. How do you guys prospect for your group business? Thanks!

There is no magic wand to writing group. It about making contacts and showing persistence. Calling every year around renewal time to get try to get an appointment.

I have been doing this for 11 years and its still a hard fought fight to get every group.

Right now I am bidding on a 6 life group. There are 2 other brokers bidding on. Three experienced brokers that are all quoting the same plans are fighting for small group.

The way you making money in group is that you have to have a lot of group prospect because some of them you will close. Once you build up a nice small group client base you will be very happy with the comp you are making.

9 months in the biz you have to sell whatever you can.

11 years in the biz I have to sell whatever I can!

I did my cold calls on Tuesday and Wed this week and it was sour. A lot of companies under 20 lives have dropped benefits.
The other company that use to be 20 lives are now 4 and they really don't care. Right now I will cold call 50 companies and get maybe 2 leads out of it. Not meetings but just leads.

somarco · 10-23-2009, 12:04 AM

R&F = rank and file

Full Throttle · 10-23-2009, 02:30 AM

The other company that use to be 20 lives are now 4 and they really don't care. Right now I will cold call 50 companies and get maybe 2 leads out of it. Not meetings but just leads.

When ever I cold called from group business, every session felt like a wasted effort. Very rarely would it be an immediate "let's get together this week and go over the options" on the first call. It happens, but they're buried in the mix. Instead, its a continual grind as you mentioned, gathering x-dates and making call backs, but it absolutely works. You just need to stay focused on getting broken bat singles over and over again. If I thought the renewals would be there in 10 to 30 years to justify the effort, I would still be on the phone pursuing the business.

somarco · 10-23-2009, 04:27 AM

Group business probably won't be affected as much by Obamacare as will the individual market. In fact, it might get better if there is a mandate on employers.

Of course employers could also make everyone part time, 1099 employees and tell Congress to go screw themselves.

Full Throttle · 10-23-2009, 06:14 AM

I could be wrong, but I figured many employers would dissolve their groups and send people to the guaranteed public option and either bonus them or pay a fine (if mandated). No one really knows, I just don't see it being nearly as lucrative in the next 20 to 30 years. I honestly hope I'm wrong.

bill3173 · 10-23-2009, 05:19 PM

Originally Posted by Full Throttle

I could be wrong, but I figured many employers would dissolve their groups and send people to the guaranteed public option and either bonus them or pay a fine (if mandated).

I think that you are right. I just had a small group dissolve and the uninsurables went to the State plan. The employer was going to dissolve the group regardless, but it made it easier because the State pool is not outrageously priced.

Just got a new 6 man group this week, and I never prospect for group. This was a referral from a long time client. I'm adding a group a month, but only because I really don't want the business. If I were chasing it, I'd never get them.

If we get the public option, small group will probably be a thing of the past.

ABC · 10-23-2009, 08:23 PM

I think you guys are voicing true concerns over the future of the small group market.

Its the economy you have to worry about right now.