Employee benefits – an untapped opportunity to grow your business portfolio

By: Nashalin Portrag, Head of FundsAtWork at Momentum Corporate

One way that organisations take care of their employees, is by including employee benefits in their employment contracts, which has impactful advantages. This is a powerful tool to attract and retain talent to help the company stay innovative.

Taking a fresh look at your clients creates unique opportunities to leverage your existing relationship with those who are CEOs, CFOs or HR executives, to open up a bigger conversation, around employee benefits.

Getting started with employee benefits

The employee benefits industry is highly regulated. Nonetheless, entering this market is easy:

• If you already have a Long-term Insurance subcategory B1 licence (No 1.3), which allows you to sell retail risk products such as disability, critical illness, and life policies, this licence also allows you to sell risk-only employee benefits products.
• If you want to sell group retirement benefits, you will need a Pension Fund Benefits licence (No 1.7), as well as one year’s experience to provide advice in this regard, and six months’ to provide intermediary services.
• To sell bundled group benefits – retirement and insurance benefits combined – you will need both the above licences.
• Other group benefits such as health solutions can be included, for which you will need a Health Services Benefits licence (No 1.16) and two years’ experience (to provide both advice and intermediary services).

There are providers that specialise in regulatory compliance and licensing solutions for the financial services industry, that are equipped to deal with applications quickly and efficiently to help you obtain your licences.

Make use of available technology

Astute Financial Services Exchange recently partnered with Momentum Corporate to introduce South Africa’s first ever Employee Benefit Switch. As a financial adviser, you can now access your clients’ financial information – including employee benefits information – on Astute Online.

Such a resource makes it easy for you to loop your group scheme business, turning group employees into retail clients. Establishing this cycle facilitates holistic financial advice and enables you to forge long-term relationships with your clients. As a professional financial adviser who offers appropriate advice throughout your clients’ lifetime, you can be pivotal in helping them reach their financial goals.

Partner with a progressive, thought-leading employee benefits provider

A progressive insurer who understands the changing South African workforce and who has a team of specialist employee benefits consultants can walk the road with you. They can help you gain a complete understanding of employee benefits to make it easier for you to expand your business into this space through innovative tools and data support. To get an idea of your earning and growth potential, have a look at these employee benefits numbers, based on available data, in the manufacturing industry:

*Subject to the legislated maximum scale

Creating a continuous business cycle

No financial plan is comprehensive without taking the client’s own group benefits into account. When you start talking to your clients about the integral role of group benefits in their own financial planning, it becomes apparent that the same is true for their employees.

Depending on a company’s needs, employee benefit packages can be structured in many different ways. Taking the desired outcomes of the employer and the needs of a new generation of employees into account, the group benefit solutions you structure for them could range from basic to comprehensive.

Once you succeed in securing group business through these individual (or ‘retail’) clients, you unlock further opportunities with their employees as individuals. For example, a company that offers entry-level benefits will likely have a substantial proportion of its employees who want to supplement their insurance and retirement benefits with additional, individual products or solutions.

This creates a full circle of business with your clients, a circle that gives you recurring business. A group scheme client is a potential client for life.

Growing your business contributes to the imperative for social change

Through employee benefits, you can expand your existing business and sustain it into the future with ease. An insurer who has a team of employee benefits specialists can help you develop young financial advisers. Not only does this enable you to continue the success of your business into the future, it also creates a new generation of financial advisers who understand that the future of financial planning requires an integrated approach.

In a country that is struggling with a deepening unemployment crisis, this creates real opportunities for South Africa’s young, talented but unemployed workforce.