Advisers and brokers have a critical role to play in getting more micro businesses to invest in benefit packages for their employees, according to Mark Till, CEO of Unum UK.
Speaking about how the SME market would embrace greater risk products more, Till said: “Number one is the role of advisers and brokers.
“These products are typically introduced by an expert rather than sought by the business owner,” he added during an Association of British Insurers (ABI) event yesterday.
“Let’s be clear – if you’re running a small business, the first thing you’re going to do when you wake up in the morning is not wonder what’s leading edge employee benefits thinking. It’s your supply chain, it’s your latest customer order, it’s when you’ve paid the bill, it’s something of that nature,” he said.
That is where the power of the broker or adviser comes in.
“On two or three times a year, someone’s going to have to come in and provide your public reliability, insurance, or your buildings and assets insurance. And if that broker extends that conversation to talk about other things, that’s probably the first and most valuable interaction point,” Till said.
Brokers can help to unlock the conversation by introducing the topic of life insurance, and keeping it clear.
“When we work in insurance, we love a bit of complexity. Well, that is not what SME’s are after – they love simplicity.”
Micro businesses account for 95% of all businesses in the UK and around 32% of employment, according to the ABI.
“I think it is fair to observe that historically the larger the business, the more likely you are to have a more comprehensive benefits package,” Till continued.
“Those firms typically overtime have built up skills and talent and can afford dedicated individuals to focus on this and therefore create a broader benefits package.
“But once one person in a sector does it, it kind of begins to create a standard which others have to copy, because they are all competing for the same talent,” he said.
Till noted that “Unum is the largest provider of group risk products to the SME market – so we have quite a lot of experience in the SME market”.
He said another factor benefitting brokers is that people are leaving larger firms to work for smaller ones, but wanting the same benefits as before.
“Therefore, the SME now has a demand from their employees, so if a broker can help fulfil that, that’s a really helpful thing,” he said.
“Let’s remember there are 32 million people at work at the moment. Ten million of them get help from a group risk provider. You’re not telling me those 22 million other people don’t suffer some form of mental health challenge, critical illness occurring, death in the family, and no-one is there to help them.
“So we should care passionately about those people who don’t get help,” he concluded.