October 2023
Voluntary Benefits Voice M A G A Z I N E
Understanding the Demographic Trends Shaping the Critical Illness Insurance Market
The Impact of Digital Crime
Industry Insights: Critical Illness
Advisory Board
Mark Rosenthal PwC
Seif Saghri BenefitHub
Jessica DePhillips Mercer
Michael Naumann Reliance Matrix
Jack Holder EBIS
Jennifer Daniel Aflac
Michael Stachowiak Colonial Life
Key Contributors
Steve Clabaugh CLU, ChFC
Editorial Staff Editors Trevor Garbers Heather Garbers Director of Marketing Marin Daniel For Media and Marketing Requests Contact: Heather@voluntary-advantage.com and Trevor@voluntary-advantage.com
FEATURED ARTICLES 01 Industry Insights Critical Illness Insurance
02
Real Life: Why Critical Illness Insurance is Important
03
Changing Concerns for Employees in a Highly Connected World
04 It’s Not Just WHAT You Think But HOW! 05 In the News
Interest in Critical Illness Surges in Wake of Pandemic
Understanding the Demographic Trends of the Critical Illness Product
From the Editor... There is a lot of competition in our industry today. Competition with brokers, competition with carriers, and competition with technology providers. This competition has revolutionized our industry and I truly believe, created a better end product and experience for the client and policyholder. Competition has also forced each stakeholder to refine their competitive edge in the marketplace. What do you think you can do better than anyone else? What does the market need? How can you stand out from the pack? This has driven some great (and much needed) change – the education and enrollment process is now adaptable to the needs of the group and employee, there are more competitive products and features to better fit the needs of the consumer, more attention is paid to workplace benefit solutions; expanding their reach in the marketplace, and pricing has decreased as carriers strive to offer affordable benefits in the marketplace. Today, I would like to focus on the last of these changes, pricing in the marketplace. Pricing is important – I don’t think I need to address the current state of the economy, inflation, cost of living and the impact on employees in the workplace, but affordability is a key component when deciding which vendor will be the best fit. The race to low pricing can also have a negative impact on the member – the “lowest” rates often leave loopholes in coverage:
By Heather Garbers
The inclusion of pre-existing condition exclusions and waiting periods that could otherwise be waived, resulting in a higher rate of declined claims. Lower benefit levels resulting in disappointed employees at time of claim, who even after purchasing coverage to protect themselves from unexpected events, are still left with high out-of-pocket costs. Fewer covered conditions on Critical Illness plans, including early-stage diagnosis that are still significant (and costly) health events, and meaningful to the member. Or even, definitions of covered conditions that are more difficult to claim (ex. 14 days of hospitalization for infectious disease or coma vs 5 days). More exclusions and limitations in Pet Insurance plans, including lifetime exclusions on pre-existing conditions and exclusion of things like lab and exam fees that are necessary for the diagnosis of sicknesses or injuries. Negotiating for the best pricing, while not sacrificing the value of these plans should be the goal in our marketplace. Having employees pay “cheap” premiums is great, until they have a denied claim and they lose confidence in these products and don’t see their value. At the end of the day, we are in the business to pay claims to help members remain financially stable after an unexpected event, sacrificing value just hurts the member and our marketplace in the long run.
A Critical Need: Interest in Critical Illness Insurance surges in wake of pandemic
By Eastbridge Consulting Group, Inc.
Not all products are created equal when it comes to the voluntary benefits industry’s continuing recovery from the pandemic. Life and disability insurance are still the market’s mainstays, but coming up fast on the outside are supplemental health products. Critical illness, hospital indemnity and accident all saw double-digit sales growth in 2022, outpacing the industry’s overall 5.4% increase. Critical illness in particular has become a star performer, leading all other lines of business with a 15% sales surge last year. It was the highest sales increase in the past five years, driving new sales premium to a record high $949 million. In fact, 2022 was the second straight year of strong growth for critical illness, following a 9% leap the year before. The pandemic can claim much of the credit for these results, driving a greater understanding of the need for critical illness insurance as employees became more aware of the actual cost of a serious illness.
As with many other voluntary products, critical illness sales are heavily concentrated among a small group of carriers. These top 10 carriers accounted for 74% of all voluntary critical illness sales in 2022: Aflac MetLife Allstate Benefits Unum Voya Financial Colonial Life Aetna Cigna SunLife Financial The Hartford Employer Perspective More than 42% of all employers regardless of size, offer critical illness insurance to their employees, either as an employer-paid, employer-employee shared cost or voluntary benefit, according to Eastbridge’s 2022 “MarketVision™ — The Employer Viewpoint©” report. Only 6% of these employers pay the full cost of the premiums. Offering the coverage on a voluntary, employee-pay-all basis is much more common.
Employee Perspective Even though one in four employers offer critical illness insurance as part of their benefits package, only 24% of employees own this coverage, according to Eastbridge’s “2023 MarketVision™ — The Employee Viewpoint©” report.
But employees not currently covered report strong interest in buying critical illness on a voluntary basis, the report shows. In fact, critical illness has the highest purchase interest index — a number based on the percentage of employees who don’t own a product and the percentage interested in purchasing it on a voluntary basis — of any voluntary product. Of the 76% of employees who don’t currently own critical illness on any funding basis, more than half (51%) say they’re interested in purchasing it on a voluntary basis.
Broker Perspective Brokers continue to value critical illness as a top voluntary offering for their clients, according to Eastbridge’s 2023 “Voluntary Benefits: Brokers Back in Business” Spotlight™ report. It’s the number two most commonly sold voluntary product for voluntary brokers and ranks number six for benefit brokers.
Learn more about the voluntary critical illness market in Eastbridge’s “Voluntary Critical Illness Products” Spotlight™ report.
Eastbridge is the source for research, experience, and advice for companies competing in the voluntary space and for those wishing to enter. For over 25 years, they have built the industry’s leading data warehouse and industry-specific consulting practice. Today, 20 of the 25 largest voluntary/worksite carriers are both consulting and research clients of Eastbridge. Nick Rockwell President
Danielle Lehman Senior Consultant
Industry Insights: Critical Illness By Heather & Trevor Garbers
October is National Critical Illness Awareness Month, meant to help spread information about critical illness prevention, treatment, and care. Consider the following: According to KFF, the average single health insurance deductible was $1,992 and family was $3,811 in 2022 55% of employees live paycheck to paycheck in the USA today 57% of Americans don’t have enough in savings to cover a $1,000 emergency expense A little over 1.9 million new cancer cases are expected to be diagnosed in the US in 2023 (excluding: basal cell and squamous cell skin cancers, and carcinoma in situ (noninvasive cancer) except for urinary bladder The human side of our industry, is that we play a key role in spreading information about coverages that can help individuals pay for treatment and care when diagnosed with a critical illness. To help us do that job well, staying ahead of market trends is always important. This month, we have interviewed: Heather Scott with Trustmark Voluntary Benefits, Matthew Ennis with Reliance Matrix, Sarah Oliver with Prudential Financial, and Bryan Burke with Sun Life for their insights on workplace based Critical Illness insurance today.
What is trending in the Critical Illness market today? Matthew: This is a multi-faceted question, on the product side, we are seeing more interest in mental health and benefits that appeal to different demographics. For younger employees, benefits for infertility and expanded childhood conditions including autism spectrum disorder are becoming more of a focus. Better coverage for underrepresented populations is also being prioritized by carriers (adult diabetes, more comprehensive breast cancer coverage for example). On the customer experience side, services at time of claim are becoming more prevalent. More carriers are offering services related to mental health, healthcare navigation, caregiving and financial wellness to name a few. Lastly, in terms of process, claims integration continues to evolve to the point where most carriers are doing some type of claims integration on the CI product. Sarah: One of the overarching trends in the Critical Illness insurance space today is expanding coverage provisions to better meet the needs of policyholders and their families. Carriers are working quickly to understand historical trends, recent medical insights and associated financial gaps for working people. This has raised the need to expand what these plans can do to provide value to people experiencing mental wellness concerns or family planning. Understanding medical trends and related financial gaps gives carriers the opportunity to provide more value by expanding their products to cover more and provide a more robust solution.
Heather: There is a growing interest in benefits and solutions to support employee mental health. Employers are looking to navigate and understand the severity and impact of their employees’ mental health conditions. With this in mind, one of the ways to promote mental health care is for carriers to include related benefits in critical illness policies to help ensure members can afford the treatment they need.
Critical Illness Trends Quick Hits Mental health and benefits that appeal to different demographics
Bryan: The biggest trends in the Critical Illness market today center around: administration, regulation, advances in covered illnesses, access to care and underwriting flexibility. There are a number of new conditions being added to Critical Illness plans - benefits for infectious diseases, caregiver support and mental health illnesses have emerged over the past few years as the pandemic highlighted coverage gaps.
Administration Regulations
With regards to access to care, access can be challenging when treating providers are unavailable in a timely manner, when care is not affordable, and when employees do not have a treatment plan or are unaware of their options. There are several services available through Critical Illness policies to help address some of these challenges faced by consumers, through both virtual and digital tools that can help facilitate treatment or provide care for milder illnesses that have potential to progress to moderate or severe.
Access to Care
You also really cannot talk about advancements in Critical Illness or employee benefits without highlighting where most investments are being made and that is in digital, data and analytics seamless connectivity with administration partners is a key focus to ensure timely and accurate transfer of data. Product development efforts are highly dependent upon structuring1 the product in a manner that facilitates digital and integrated client experiences, in addition to ease of understanding for consumers and internal stakeholders. While insurers make significant investments to digitize the entire client experience from quote through claim, they are also focusing on creating operational efficiencies and leveraging data to share deeper and more impactful insights with clients. Specific to Critical Illness insurance, there is strong market demand to ensure claims are triggered not only from direct claim submissions but are also automatically triggered from other benefits.
For carriers to include related benefits to help ensure the affordability of treatments
Expanding coverage provisions to better meet needs of policy holders
Underwriting Flexibility
Bryan: There is also more demand and an opportunity for insurers to highlight the impact of these investments by sharing utilization data with clients to highlight the value of the benefits and identify key areas for future benefits education and communication. We are also seeing more requests to take over original entry age on issue age rated products. This means holding the original rate or applying a new rate associated with the member’s age at their original effective date. Lastly, from a federal regulation perspective, we are very closely monitoring the tri-agency proposed rulemaking on fixed indemnity products. Specifically, the taxation of benefits and comments related to future potential rulemaking which would prohibit our ability to pay based upon severity of an illness. At the state level, more states are scrutinizing wellness benefits and not allowing them, and some states will not allow hospitalization as a way to distinguish the severity of an illness.
We are seeing carriers expanding their definitions and payouts of covered conditions and paying benefits for lower stage conditions. When it comes to claims, which of these trends do you believe has a meaningful impact on the member? Heather: Including benefit triggers for early identification and early-stage conditions for Cancer, Heart Attack and Stroke can have a very meaningful impact on the member. Receiving care, regardless of the severity of the condition, will incur costs for members. It’s important for members to be assured that they will have the funds available to pay for part or all the costs associated with seeking treatment. More importantly, covering these conditions at an early stage encourages members to seek treatment earlier to avoid having more severe health problems in the future. Matthew: Lower stage cancers and less severe conditions are more common so I would expect that they would have a meaningful impact to members in terms of claims. This is evidenced by cancer in-situ being ranked 4th in claims paid across our book of business. I would also say that to the extent that coverage for less severe conditions can incent early detection and treatment, these benefits will have meaningful impact on members and also carriers and employers. For example, TIA strokes are often ignored and untreated because people don’t realize what has occurred. Having greater awareness and a benefit available to you can increase the likelihood that treatment is sought and can greatly reduce the risk of a major stroke in the future. Bryan: Lower stage cancers certainly have the biggest impact. This leads to fewer denials and a higher level of client satisfaction. In addition, advancements in covering progressive cancers that were diagnosed prior to the policy effective date further provide value for members. There is also demand to add benefits for autoimmune disorders and expanding progressive disease benefits to cover less severe forms of diseases like: Dementia, Diabetes, Parkinson’s Disease and MS to name a few. We are also seeing an emergence of covering conditions that are more prevalent in underserved communities such as: Insulin Dependent Type 2 Diabetes, expanded Cardiac conditions, Sickle Cell Anemia, Premature Birth and other Pregnancy Complications. While insurers are busy adding a number of new features, the frequency with which these new features are actually sold remains low unless the corresponding rate load is low, which ultimately means utilization will most likely be low.
Sarah: Reducing severity and increasing covered conditions needs to be a top priority of the industry to better care for policyholders. All of these examples are important as well as increasing coverage for mental wellness and family planning. Adding options to include less severe conditions and having those available allows employers to choose the best package for their employees. Optionality is key. What are the most commonly claimed conditions on your Critical Illness plan today? Sarah: We see a significant number of claims for Cancer (both Invasive and Non-Invasive), Heart Attack, Stroke, and Coronary Artery Disease. When it comes to the wellness benefits specifically, we see the most volume with lipid panels, mammograms, and routine wellness visits. Heather: Cancer, Heart Attack and Stroke continue to be the most commonly claimed conditions. These conditions combined make up 97% of our claim block. Carriers are starting to differentiate their plans by focusing on these three conditions and paying in stages depending on the severity of the illness. Bryan: Our top 10 claimed conditions by frequency are: Invasive, Heart Attack, Cancer in Situ, Major Organ Failure, Stroke, End-Stage Kidney Disease, Skin Cancer, Coronary Artery Bypass Graft, Angioplasty/Stents, and Benign Brain Tumors. Matthew: Our top claimed benefits in terms of benefit dollars paid are Cancer, Heart Attack, Wellness, Cancer In-Situ and Stroke. What do you see as the most commonly denied Critical Illness claims? Sarah: We see denial volumes focused on claims for instances that happened prior to the effective date of coverage or because the contractual definition of the condition is not met. These examples show the need to provide education and to set expectations at enrollment. Carriers should also be looking at the contractual definitions to see where revisions might be needed to reduce claim denials. Heather: We typically see three key reasons for claims being denied: the condition was not a covered critical illness, pre-ex exclusion, and the insured had already received a benefit for claimed condition. Specifically, when it comes to denial for the claim not being a covered condition, it’s often because the claim is for an early-stage illness.
This played a large part in our decision to cover those early-stage and early identification benefits referenced above and is a large reason why Trustmark’s Critical Illness claim denial rate is 8%, compared to the industry’s denial rate of 32% (Critical Illness 2022 Research Report. Milliman, 2022).
How can we make the Critical Illness claims process easier for the member? Bryan: It should come as no surprise that there is a race to automate the Critical Illness claims process and significantly reduce turnaround times and effort needed by members to submit a claim. Transparency and improved digital self-service tools that clearly articulate the claims status and any missing information is what members request most frequently. Automated claimant communications that send messages by text or email as soon as claims are submitted, status changes, payments issued or simply for missing information will also dramatically improve the claims process for members.
What percentage of employees do you find port their Critical Illness plans when they cease employment? Are there any tactics you have found helpful to increasing porting rates? Bryan: Portability rates remain extremely low in the single digits. Tactics to increase port rates include: proactive port communications on behalf of the employer, holding the same rates paid under the group plan, and maintaining portability well beyond when the group master policy terminates.
Sarah: In addition to having an engaging enrollment strategy to provide needed education, the best thing that can be done for members is to have an integrated and digital claims experience. People operate most efficiently with digital tools, and it reduces the time to payment. Also, by integrated, we mean adjudicating and paying claims based on information that may have been submitted with other lines of business. With that information, it creates a seamless experience for members for us to just pay the claim and send them a notice to explain it. Medical integration is critical here. Partnering with vendors like Benefits Science Technology, a Multiplan Company, to receive medical information that could be used to initiate and pay a claim for people when the employer opts into this service – removes a lot of the claims burden from members.
Heather: The number of employees that port their policy can vary drastically between groups, but there are several ways where we believe there is opportunity to improve that number. The first is to maintain a relationship with the employee throughout the life of their policy. At times there can be a “set it and forget it” approach to employees once they’ve enrolled, but maintaining ongoing communication and education about their policy, helps to consistently reinforce the value of their coverage. Additionally, being responsive with communication with an employee when they do leave employment pays dividends as well. And, finally, we are seeing a growing number of clients make use of ACH payment, which makes it easy to port the policy since they don’t have to transition to a new form of payment when they leave their employer.
We can make the claims process easier for the member by: Russ Norris
Providing multiple channels for submitting a claim (phone, email, online, etc.) Making sure forms are easy to read and understand. Carriers should offer to reach out to providers for any needed medical records and cover any document costs. Communicating with the claimant throughout the process from submission to payment via their preferred communication channel (phone, email, text). I think user experience testing and claimant surveys are critical sources of feedback that should be used to identify areas for improvement in the process and something we do regularly.
Matthew Ennis, DirectorProduct, Marketing and Strategy Reliance Matrix
In addition to the basics above, innovations aimed at identifying claims the member forgot to file or did not realize they were eligible for are also creating a better claims experience. Claims integration and use of AI technology fall into this bucket and will be an opportunity for carriers to differentiate now and in the coming years.
Heather: I believe we can make the claims process easier by improving the way we cover critical illnesses: allowing for pathological diagnosis rather than requiring clinical diagnosis and allowing payments for less severe illnesses that often get denied. Looking more at the nuts and bolts of claims filing, there aren’t many surprises on how to improve. It largely comes down to improving technology with things like: online and mobile claims tools, text message updates and claims auto-adjudication to expedite the process and the communication surrounding claims.
It is said that a doctor named Marius Barnard created Critical Illness insurance. Dr. Barnard was a heart surgeon who was part of the team that performed the first human-to-human heart transplant in South Africa in 1967. Dr. Barnard recognized that his patients were in many cases, unable to return to work in full capacity after a chronic health event. They felt the lingering effects of their illness: surgeries, medication, and recovery, which had an impact on their ability to earn an income. So, in 1983, with a South African insurance company called Crusader Life, Dr. Marius Barnard introduced critical illness insurance to the market.
Thank you to our experts who provided feedback on the state of the Critical Illness Insurance market Dr. Barnard’s creation came to the U.S. in 1997 and as of this month! 2021, Gen Re’s U.S. Critical Illness Insurance Market Survey, estimates that there are 5.6M policies and $1.7B of premium in-force, helping countless Americans remain financially stable after experiencing a critical health event.
Heather Scott, Senior Director of Product and Innovation, Trustmark Voluntary Benefits in her role, she is responsible for managing Trustmark’s health products. Her voluntary benefits industry experience includes product development, product management and integrating products into benefit administration systems.
Matthew Ennis, Director-Product, Marketing & Strategy Reliance Matrix - Matt is a customer focused product leader hyper-focused on the employee experience and the customer value proposition. He takes a data driven, customer feedback approach to product development and management. Matt has been with Reliance Matrix for 3 years but has a long history in the employee benefits industry, spending 16 years at another carrier in various roles including underwriting, operations management, marketing, enrollment strategy and product development.
Sarah Oliver, VP, Head of Voluntary Product, Prudential Financial, Inc. - where she is responsible for voluntary product development, enrollment and best in class technology to meet the needs of clients, including large and medium-sized companies, banks and associations. Sarah joined Prudential in September 2022, focusing on all aspects of voluntary product and business strategy, including developing the long-term product, enrollment and technology vision, new product development and in-force management.
Bryan Burke, AVP Product-Voluntary Benefits, Sun Life- for the past 21 years he has worked for Sun Life in several product strategy and operational roles. In his current role, Bryan is responsible for Sun Life’s voluntary strategy, product development, market and competitive intelligence and voluntary claims administration. Bryan participates in several industry committees and is currently a Member of the LIMRA Workplace Benefits Advisory Council.
Real Life: Why Critical Illness Insurance is Important
By Michael Naumann
Focus on Real-Life Stories to Support the Data You don’t have to be in our business to know a critical illness can arise at any time, out of the blue. According to the American Association for Critical Insurance, approximately 40% of men and women will receive a cancer diagnosis in their lifetime. Heart attacks and strokes occur every 40 seconds in this country. The Parkinson’s Foundation reports 1 million people are suffering from the disease in the U.S., and that number is expected to reach 1.2 million by 2030. The good news is, most will survive, but with that comes the cost of treatment, along with predictable and unforeseen ancillary costs – which brings the bad news. Most are not prepared. There’s a tremendous volume of data about the number of Americans with limited savings. Bankrate’s annual survey found nearly 60% of U.S. adults are not prepared for a $1,000 emergency expense. You don’t have to dig too far into the research to find the number of workers enrolled in High Deductible Health Plans, statistics on the number of workers who can’t afford the out-of-pocket medical and nonmedical expenses when an unexpected critical illness medical event occurs, and figures on the prevalence of a severe medical diagnosis paired with enrollment data on how employees waive off enrolling in Critical Illness plans.
These realizations led me to look deeper into the medical and non-medical expenses incurred specifically when cancer strikes. Perhaps not surprisingly, I found myself knee-deep in GoFundMe efforts from those seeking financial help because of a medical event. As I reviewed these heartfelt requests for financial support, the research data, statistics, figures and numbers faded as real-life stories truly proved the importance of, and need for, Critical Illness insurance. Consider these scenarios.* The financial implications include more than the cost of treatment. “We are asking for donations of any amount to help this family cover the cost of meals, childcare, procedures not covered by insurance, loss of income and eventual loss of benefits and any additional support they need.” “Cancer treatment isn't only challenging for the patient, it's expensive, with many associative costs not covered by insurance or even anticipated until yet another medical invoice arrives.” “I've estimated that they will spend approximately $15k this year towards travel, in addition to ongoing medical bills that are regularly paid to cover treatments. Cancer treatments are not fully covered by insurance and chemo/radiation costs thousands.”
“Donations will be used for expenses related to treatment, including but not limited to: ongoing oncology care, medications, infusions and transfusions, biopsies, social and nutrition care, home health care, and any expenses connected to the stem cell transplant and subsequent recovery. In the rare event it becomes necessary, funds may be used to supplement and assist with mortgage payments.”
Inevitably, there are unexpected expenses in order to receive the best care.
Not all effective treatments will be covered. “Like everyone living with cancer, I want to explore all options and try all treatments with sufficient evidence of efficacy that may help me. One targeted therapy is not funded by the NHS and, while it is available privately, it is not licensed to be used with other treatment methods that are only licensed as monotherapy. This resulted in my insurance company declining this additional treatment.” “The estimated cost of these innovative treatments is in the tens of thousands, and whilst they are willing to pay whatever they can, it is money Stacey and family do not have, and due to the disease's aggressive nature, time is of the essence.” There is a solution.
“Much of the additional support is not covered: shortterm surgery recovery therapy, long-term tutoring, as the radiation treatments can cause cognitive repercussions that may follow her through the length of her school career. There are also travel expenses and accommodation in Grand Rapids for the 6-week radiation treatment, scans every 3 months, and many, many more years of follow-ups to come.” “Unknown aspects of Cecily's diagnosis could lead to more financial needs including additional childcare services for Cecily's younger sister while the family supports her in her treatment and travels to doctor visits. There is also a need for family meals or food prep programs during times of treatment and recovery. “There are a lot of hidden costs involved in having cancer and, with this treatment and surgery, it’s not possible to work right now. The money raised here will help with travel to treatments, the reconstruction after surgery, and also day-to-day living. It’s not something I ever thought I’d have to do but any help is greatly appreciated.”
These personal stories are just a sampling of the thousands of online crowdfunding requests for financial support due to medical events, many of which are covered by critical insurance policies. As carrier representatives, insurance advisors, and human resource teams, we offer life-changing cash benefits to solve these problems. But too many are unaware or don’t recognize how important these solutions are for many. We need to build thoughtful communication, education, and engagement strategies so employees fully understand the real value of Critical Illness insurance. This is even more valuable now that many CI plans are increasing the range of illnesses covered beyond the traditional Cancer, Heart Attack/Transplant, Stroke, Coronary and Major Organ Failure to include Progressive Diseases (e.g. ALS, Parkinson’s, MS, Alzheimer’s, ARDS), many Childhood Conditions (e.g. Type 1 Diabetes, Down Syndrome, Muscular Dystrophy), Infectious Diseases, and even Occupational-related Diseases. …the list goes on and the need for CI is more critical than ever.
*Stories edited for clarity and to protect privacy
Michael Naumann, Worksite Practice Leader (Western US) for Reliance Matrix Insurance Company - Michael has over 23 years of diverse experience across employee benefits, enrollment solutions, affinity-based programs and third party administration. At Reliance Matrix, Michael creates sales and marketing strategies to accelerate worksite growth, drives business development, and influences product development.
Understanding the Demographic Trends Shaping the Critical Illness Insurance Market By John Allen, EOI Service Company Critical Illness Insurance has become increasingly important in today's environment, as it provides financial security to individuals and families when they face severe health challenges. This form of insurance has gained prominence due to rising healthcare costs and the unpredictable nature of critical illnesses. Additionally, with a lump sum paid upon a diagnosis of a covered critical illness, the need to dip into savings or retirement funds can be avoided. According to MetLife’s 21st Annual U.S. Employee Benefit Trends Study, 51% of employees surveyed see Critical Illness Insurance as a must have benefit. Within EOI’s book of business, Critical Illness ranks second in terms of premium written, just below permanent life with long-term care insurance and just above accident insurance. Demographic buying patterns play a crucial role in understanding how different segments of the population recognize the importance of and purchase Critical Illness Insurance. In this article, we will explore demographic trends shaping the Critical Illness Insurance market.
51%
Age One of the most significant factors influencing the purchase of Critical Illness Insurance is age. Typically, individuals in their 30s and 40s are more likely to consider this insurance. As people age, their vulnerability to critical illnesses increases, making them more inclined to invest in a policy that can provide financial support. Additionally, people in their 30s and 40s are often in the midst of their careers and have significant financial responsibilities, such as mortgages and children's education, making them more aware of the need for financial protection.
Income and Socioeconomic Status Income and socioeconomic status are critical determinants of Critical Illness Insurance buying patterns. Individuals with higher incomes and a more comfortable financial standing are more likely to purchase comprehensive policies. These individuals often have a higher risk tolerance and can afford higher premiums, which provide greater coverage. On the other hand, those with lower incomes may opt for more basic policies or may not consider Critical Illness Insurance due to budget constraints.
Percentage of employees that indicate Critical Illness is a must have benefit. [1]
Family Structure
Health History and Pre-Existing Conditions
Family structure plays a pivotal role in influencing the purchase of Critical Illness Insurance. Families with dependent children are more likely to consider this insurance as a means to secure their children's future in case of a critical illness diagnosis. Single individuals or couples without children may be less inclined to purchase such insurance, as they may not have the same level of financial responsibility.
An individual's health history and pre-existing medical conditions significantly affect their eligibility for Critical Illness Insurance and the cost of premiums. Those with a family history of critical illnesses or pre-existing conditions may be more motivated to purchase this insurance as they perceive a higher risk of developing such illnesses themselves.
Gender
Geographic Location
Gender can also impact the buying patterns of Critical Illness Insurance. Historically, women have shown a higher interest in this type of insurance, primarily because they tend to live longer and face a higher risk of certain critical illnesses like breast cancer. However, with changing societal roles and increasing awareness, men are increasingly recognizing the importance of Critical Illness Insurance and are actively purchasing policies.
Geographic location can also impact buying patterns. In countries with a robust public healthcare system, individuals may be less motivated to purchase Critical Illness Insurance compared to those living in regions with limited healthcare coverage. Cultural factors and local insurance regulations can also influence buying decisions.
What is Critical Illness Insurance? Health insurance can provide coverage for many of the costs associated with treating a critical illness like cancer or heart attack. But what about the other out-of-pocket costs that you incur when you or a loved one is battling a major illness and is unable to work? There’s lost income — even if you have disability coverage, which only pays a portion of your regular earnings — along with co- pays, deductibles, family and living expenses, and even transportation costs to and from treatment. Many of these additional costs can contribute to the pressure you are already under at the worst possible time. Critical Illness Insurance can help to cover some of those gaps in your financial plan that you may not have even known existed.
Understanding the demographic buying patterns of Critical Illness Insurance is essential for insurance providers to tailor their offerings and marketing strategies effectively. While age, income, family structure, gender, health history, and geographic location are key factors that influence purchasing decisions, it's important to note that individual motivations and circumstances vary widely. As healthcare costs continue to rise, and people become more aware of the financial risks associated with critical illness, the demand for Critical Illness Insurance is likely to continue growing across various demographic groups. Insurance providers must continue to adapt and innovate to meet the evolving needs of their diverse customer base.
Insurance providers have taken notice and due to these buying trends, an increase in demand, and the pandemic, many have expanded their list of covered conditions to include categories such as infectious diseases, childhood conditions, and chronic conditions. To remain competitive, many will now offer plans with no pre-existing condition limitations and no maximum benefit limitations including benefits for recurrence, typically subject to a separation period between claims. Now is the ideal time to evaluate a client’s existing plan to ensure they are providing the most competitive and comprehensive plan available or recommend they offer a Critical Illness plan if one is not being offered.
[1] MetLife's 21st Annual U.S. Employee Benefit Trends Study
John is President of EOI where he executes and develops strategic marketing initiatives on a national level, specifically focusing on the enhancement of value-added services that EOI provides for its clients. Since joining EOI in 2009, John has played a key role in the area of strategic marketing, building an outstanding implementation team in the Chicago office and tripling sales in the Midwest region.
Changing Concerns for Employees in a Highly Connected World and What That Means for Employers
By: Kristin Lewis, Strategy & Product Management Leader at Aura
Since 2019, Americans have lost more money annually to online crime than to home burglaries, and total losses are growing exponentially. Last year, losses totaled $10.3 billion, with 1 in 4 Americans reporting they have experienced some kind of digital crime in the last 12 months[1]. The numbers are shocking, but when you think about the critical role that technology plays in every aspect of employees’ lives, the risk shouldn’t actually be that surprising. My job requires me to be connected throughout the day, using my company-issued devices on my home network. As a mother of two screen-time loving boys, my kids require constant supervision. And, to top it off, I frequently act as the IT-department for my networked, but aging parents. One thing that I’ve noticed, both through my role at Aura and my responsibilities at home, is that the threats we’re facing online seem to be getting smarter. More targeted. More effective. With easy access to AI tools like ChatGPT, attacks are getting more convincing and more sophisticated. And the attempts to break in or catch you off-guard are relentless. It feels like it's only a matter of time before someone in my family will fall victim. I know I’m not alone in this stress.
1 Javelin Proprietary Data. 2023 Identity Fraud Study
The Impact of Digital Crime on Employee WellBeing Falling victim to online crime such as scams, fraud, or identity theft can have an incredibly detrimental effect on employee well-being, and the data shows it. 54% of people report experiencing moderate to extreme feelings of anxiety or stress following a scam and 1 in 5 of those who have fallen victim to an online scam say they struggle to focus after the incident. That's why providing access to holistic online protection for employees can also protect your company. According to MetLife’s 2021 U.S. Employee Benefit Trends Study, 51% of employees say that employers should play a greater role in the safety and protection of employees and their families. Further, once an identity theft solution is made available to employees, employers see immediate benefits: 80% of employees report an improved opinion of their employer 90% of employees state that they are more invested in their company’s cybersecurity protocols. And, finally, in the event that the employee or someone in their family does fall victim to online crime, 89% of those impacted remain engaged at work.
The Toll of Cybercrime on the Enterprise Last year, business email compromise attacks resulted in nearly $3 billion in losses, according to the FBI. That doesn’t even account for scams conducted via text message, which accounted for $330 million in losses last year, more than double what was reported in 2021. A leading culprit of these attacks is imposter scams where the cybercriminal pretends to be a trusted source of information for employees- the company CEO, a member of the HR team, or another senior leader. You probably encountered the CEO scam that was circulating by text last year. This is how it worked. A message from an unknown number pops up on a new hire’s personal cellphone. “Hey, it’s John Smith, CEO. I’m in a meeting and can’t talk, but I need your help.” Once the user engages, the imposter would ask the new hire to purchase gift cards and send them to the “CEO” or make a payment via a portal to get the “CEO” out of a bind. If you’re anything like me, you’re thinking, “I would never fall for that.” But, these scams start trending because they’re highly effective. 53% of all people scammers approach will engage. And, because 87% of businesses rely on employees to use their mobile devices for business purposes, phishing attacks on an employee’s personal device can make sensitive company information more easily accessible to hackers. The leading advice to improve employee online safety protocols is to increase training and ask employees to be more vigilant about spotting risks on their own. But with the volume of attacks rising, what are the chances that an employee gets targeted at a moment when they’re distracted? What could the damage be to the broader organization if that employee falls victim? You may have heard of the recent hack that brought operations at MGM Casinos to a screeching halt. This is just one example of a long line of hacks, ransomware attacks, and breaches that were executed as a result of employee-targeted social engineering.
In the case of MGM, the attackers sent messages to targeted employees claiming they needed to reauthenticate their identities or update account information. The messages contained a link to a spoofed corporate domain designed to emulate a familiar login page to trick employees into sharing their credentials. The hackers then had the information they need to bypass the enterprise security system. While MGM sorted through the breach and its implications, analysts estimated the company was losing between $4.2 million and $8.4 million each day. The Case for an Intelligent Identity & Fraud Protection Benefit While there are a number of competing approaches to online safety, an intelligent safety solution will provide all-in-one, preventative protection for employees and their families that is affordable and easy to use. Earlier, I mentioned how criminals are using AI to make their attacks more effective. Well, intelligent safety systems use the same advanced technologies and set them loose against criminals’ attacks. Basically, fighting fire with fire. And the most important feature of a good intelligent safety system is its ease of use. The beauty of intelligent safety systems is that they don’t require technical expertise to operate. Given how interconnected our digital environments are, behaviors on one platform will impact employees’ family’s safety on another platform. And, beyond that personal risk, behaviors of employee’s family on devices outside your corporate network could put the security of the employers’ entire enterprise at risk. In this digital reality, wouldn’t you want to know that your protection is interconnected as well? By providing employees with an intelligent safety benefit, you help ensure their family is well protected and they can rest easy in the knowledge that they are fully covered.
It’s Not Just What you Think but How!
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By Steve Clabaugh, CLU, ChFC Almost every morning, for the 50 years we’ve been married, Gretchen and I have started the day with what we like to call our “Morning Mugs.” In the quiet of the early morning hour, we enjoy our coffee and conversation about everything under the sun. It’s my favorite time of day even though our approach to the time is very different. Here’s an example from an actual recent morning together: Gretchen’s thoughts and comments between 6:00 – 7:30am (abbreviated version). “Don’t forget, I have quartet practice at 10:30 this morning; I got tickets to go to the Christmas Show at the Carolina Opry with the kids at Thanksgiving rather than New Year’s Eve; On the Wednesday of our trip to Montana next July we have a choice between a hike or a cruise on the lake – I’m thinking the cruise will be more relaxing after 3 days of hiking; we’re meeting the kids at church this Sunday rather than picking them up at their house; we’re meeting the Musselwhites for lunch at 11:30 this morning; instead of the Christmas show on New Year’s Eve, I found a Strauss concert that afternoon we can attend; we need to spend some time with Nancy this week – she's really missing Harry and can use the fellowship and encouragement; I saw Beth yesterday afternoon and she is feeling much better now. “
Steve’s thoughts and comments between 6:00 – 7:30am (full version). “Get the coffee started; try to follow Gretchen’s thoughts; work on article for Voluntary Advantage this morning; volunteer at stables this afternoon; maybe I can fit in a little fishing before going to the stables.” At first glance, you might determine that the difference in our thought process is because Gretchen is clearly much smarter than I am – and you would be correct that she is. But the real difference is not in what we are thinking but in how each of our brains work. In 1951, Dr. Roger W. Birkman created The Birkman Method to measure personality characteristics that influence behaviors, motivations, and perceptions. Among the issues he studied was the phenomenon of why some people can hold multiple random thoughts and ideas in their brain at the same time; process them without confusion; arrive at practical decisions and implement those decisions in a positive manner. Other people identify and process thoughts and ideas on a straight line from point to point until arriving at a conclusion and logical implementation.
Dr. Birkman gave definition to these differences (and others) describing them this way: Conceptual-Global: “Individuals with high scores on Conceptual and Global are strategic thinkers and are often comfortable with ambiguity. They can be quite patient when reflecting on all the possibilities – even those that have little chance of actually coming to fruition. Open to new ideas, they prefer to consider all facets of a problem or issue before taking action. Their problem-solving approach would often be considered more intuitive than fact-based. They consider it their priority to make sure that the problem has been thoroughly identified and defined. Then they take action on solving the problem.” (thewineingercompany.com) Concrete-Linear: “Individuals scoring highly on both Concrete and Linear are practical and action-oriented. Their credo is “Give us the facts and get out of our way.” These individuals see the use of logic and hard analysis as valuable and necessary. On the other hand, they are impatient with the planning process and often question its value. They are at their best when the problem to be fixed can be readily analyzed and contains an element of urgency. Objective and pragmatic, these individuals are not drawn to problems just because they are problems. The problems need to have practical results if solved.” (thewineingercompany.com)
Map from https://birkman.com/resources/articles/map-your-success
Many years ago, Gretchen and I learned about Dr. Birkman’s research, and we discovered his definition of our different approaches to thinking. Gretchen’s mind processes thoughts on a Conceptual-Global basis while mine is Concrete-Linear. This difference can be very frustrating and uncomfortable in a marriage. Looking back, we saw that most of the conflicts we have experienced were based our different thinking processes. Understanding the differences has had a great and positive impact on our relationship. The differences in how we process, and plan can cause major conflicts in business as well. Have you ever experienced confusion and frustration as part of a committee or team involved in planning and implementing an important project? Chances are much of the confusion was caused by the conflict of Conceptual-Global vs Concrete-Linear thinking. The great news is that once you understand the differences and prepare for them, you can accomplish some truly great things. Over the years, I have seen the positive results of respecting and encouraging both types of thinking on such critical areas as: developing effective sales strategies; budget planning and coordination; high level corporate meetings; board presentations; incentive trips; departmental organization; developing job descriptions for new positions; creating organizational structures and more.
As you begin to think about this, here’s an important tip that has really helped me. Conceptual-Global thinkers can adapt their thought processes to that of Concrete-Linear thinkers. Unfortunately, it doesn’t work well in reverse.
To learn more about how to understand and prepare for differences in thinking styles, I highly recommend considering the materials and programs from The Birkman Method (birkman.com) or The Wineinger Company (thewineingercompany.com).
Both at home and in the community when I feel a little lost during planning projects, I have learned to point out to my Conceptual-Global friends that “you just went on a trip without taking me with you.” It’s a friendly non-threatening way to help them re-set the discussion to fit into my Concrete-Linear brain processes.
As always, please feel free to contact me if you’d like to discuss this or any other aspect of Relational Leadership at sjcsr@hotmail.com.
Steve Clabaugh, CLU, ChFC - started his career in insurance as a Field Agent, moving on to Sales Manager, General Manager, Regional Manager, Vice President, Senior Vice President, and President/CEO. A long time student of professional leadership, Steve created the Relational Leadership program that has been used to train home office, field sales associates, mid-level managers, and senior vice presidents.
Interested in Learning More About Relational Leadership for Yourself or Your Organization? Contact Steve Clabaugh, CLU, ChFC at sjcsr@hotmail.com Effective leadership today requires more than technical and professional expertise in a particular field. It requires successful team building skills in equal proportion to knowledge, experience and talent. The purpose of this program is to prepare and strengthen the skills of current and prospective future leaders in: • Selection and Training • Team Building Process and Challenges • Mentoring • Positive Problem Solving • Effective Conflict Management • Determining and Achieving the Best Outcomes • Applying Classroom Principles to Real World Challenges
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