Your Shot: What Benefit Brokers Can Learn from Hamilton

How many of you have been fortunate enough to see the Broadway hit Hamilton? I recently had the opportunity to see the Chicago cast and was hooked from the opening moments, and fascinated by the entire performance. If you have been lucky enough to get tickets, you probably left with the same fascination I felt by this unique take on a previously overlooked figure in American history.

Hamilton has taken America by storm. In 2016, the median ticket price was $1,600. The show has consistently sold out all 1,321 seats at the Richard Rodgers Theater in NY and is grossing $1.9 million a week in ticket sales. This article is inspired by one of the songs in this smash hit. Alexander Hamilton is able to harness the attention of many young revolutionaries with his verbal skills. He speaks about his future hopes, his disillusionment with the British government and his desires to be remembered even if it means dying in the song, “My Shot.”

"I’m just like my country, I’m young, scrappy and hungry

With every word, I drop knowledge

I’m a diamond in the rough, a shiny piece of coal, Tryin’ to reach my goal.

The plan is to fan this spark into a flame

I amaze and astonish, the problem is I got a lot of brains but no polish"

Alexander Hamilton did not throw away his shot. He saw opportunity with the chaos caused by the American Revolution, seized it, and became one of the most successful founding fathers of this country. His knowledge and vision for America literally changed the world he was living in, and was able to achieve some of the most amazing feats in history. However, recognizing opportunity, educating yourself, polishing your skills, and executing effectively is a lot easier said (or sang) than done.

“Scrappy and Hungry”

Let’s enter our current landscape. A new presidential administration, potential wholesale changes to the ACA, and mass confusion in the marketplace is now the norm. The average age of an insurance broker is rising, and employers are looking for guidance more than ever before. Does this scare you? Does this excite you?

For some, this is a motivator to stay hungry and succeed. For, others, this uncertainty makes you want to run away as fast as possible. The insurance industry is notorious for being resistant to change, but facing the fear of change with a winning strategy may be the most impactful business decision brokers make in 2017. Like Alexander Hamilton, don’t throw away your shot at a tremendous opportunity to thrive. Adopting Hamilton’s attitude to be “Scrappy and hungry” looks to carry the day. Carlo Mulvenna, from Pan-American Life Insurance Group, explains the fertile market in “Why now is the best time to be a broker.” He quotes a LIMRA study that 84% of employers are open to change and willing to talk to other brokers to hear about opportunities. With this in mind, what are employers looking for when discussing their benefits strategy? They want a true consultant and strategic advice. This means that employers are seeking the knowledge that benefits brokers have, couple with a well thought out strategy.

“Drop Knowledge”

Armed with knowledge gleaned from years of experience, what areas can brokers focus on that are influencing buying priorities and preferences within the employer arena? Here are a few:

• Population health management and wellness programs becoming mainstream
• Consumer driven healthcare and alternative funding structures
• Detailed benchmarking of plans, costs and competitive positioning
• Expanding employee choice through customized benefits and voluntary benefits
• Compliance of ACA
• Private exchanges
• Simplifying benefits with HRIS systems
• Innovative cost sharing and plan incentives

As a broker/consultant, are you and your agency embracing all of these opportunities? Are you at least bringing them up in conversation? The broker/consultant that does bring them up will have a clear competitive advantage just by raising provocative questions and showcasing their knowledge. Education and communication around these areas are what employers are seeking. I can only imagine being an employer and being completely overwhelmed by the benefits arena. These businesses have a difficult enough job keeping their doors open and employees happy to take the time to develop and implement an effective benefits strategy.

“Spark into a Flame”

Employers seek a multi-year strategy with short and long term goals in mind, which will ultimately provide them the peace of mind of not overreacting to potential market and legislative changes. 

The employer engagement model for agencies might need a fresh take. The rise of consulting and the idea of charging a fee for your professional services is getting more popular and can be a tremendous opportunity in 2017. The fear of change lends this to being an unpopular option in the minds of more traditional brokers because “we haven’t done this before” or “my employer groups wouldn’t pay.” This mental block is something that exists in brokers minds, and needs to be overcome. Is this no different than an attorney, CPA, or financial planner charging a fee for their professional expertise? Consumers are willing to pay for experts to solve pain if there is value. How do you ignite this conversation into a new business opportunity? When you sit down with your clients does your engagement model and process include discussion around all of the following areas?

• Risk & Financial Management
• Benefit Communication
• Administration and Technology
• Health Management
• HR Consulting
• Compliance

All six of these categories are crucial and could change the trajectory of your strategy depending on the client, industry, size, etc. Yet most brokers do not have a formal process in place to uncover pain points in these areas. The top agencies who are showing double digit growth year-over-year have a standardized process in place - even branding it. They articulate this step-by-step process to highlight the added value and vision this allows the employer. Does every broker not have access to the same carriers, rates, and electronic platforms? Of course they do. It is the knowledge, process, and execution of a written strategy that differentiates traditional brokers from trusted advisors.

“Brains but no Polish”

Technology is sometimes looked at as friend and foe to brokers. In 2016, there were over 130 new startups in all facets of insurance (including employee benefits, P&C, individual, and wealth management). In the employee benefits realm, many technologies have focused on analytics, enrollment, communication, benchmarking, and wellness. The fear in the minds of benefits professionals is if these technologies are created to align themselves with brokers, or intended to replace brokers in the future. It is a valid approach to be critical regarding the intentions of these technical upstarts, but to disregard them all out of hand would be foolish. Why? Simply put, this trend is going to continue due to the sheer size of the insurance industry. In 2013, there were $1.1 trillion in insurance premiums recorded by the US department of treasury, representing 7% of the US GDP. This industry is also dominated by old institutions and is ripe for innovation and technology. Technology will be able to provide transparency, data, efficiency, and a whole host of new ways to change the employer and employee engagement models.

Brokers should be researching the appropriate technology to align to with their agency goal - embracing them and putting a plan together to execute effectively. The Blockbuster - Netflix and Taxi - Uber disruptions are direct examples for an insurance industry ripe for similar change.

“Amaze and Astonish - Take Your Shot”

Continue to be a student of the industry, embrace change (and toss away the fear of it), be resilient, and never stop improving. As soon as brokers adopt this mindset, they can begin to build their custom winning strategy. Benefits brokers and consultants have a huge opportunity right now. Like Alexander Hamilton, embrace your shot, rise up and see what mark you can leave on this industry.

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