How can the insurance market move the dial on wellbeing solutions?

Earlier this year, British insurance giant Aviva saw its profits boosted by a boom in demand for private health insurance across the UK. The insurer revealed how fear over NHS waiting lists contributed to a 41% year-on-year increase in its sales of health insurance, with strong demand from both businesses and individuals.

Given that NHS waiting lists remain at elevated levels, there is a real opportunity for the insurance industry to provide value-add products and services to consumers, and for brokers to be an integral part of that. However, many insurance companies looking to provide innovative solutions are running into the roadblock of trying to differentiate themselves in a largely homogeneous market.

There are only so many ways to pay a doctor’s bill or a life insurance premium differently, so how can insurers create genuine value-add services that set them apart without incurring costs for the policyholder, and, in turn, making that policy harder for the broker to sell?

Wellbeing solutions

A viable answer could be wellbeing solutions, particularly given that the post-COVID spotlight on wellbeing in general – and mental wellbeing in particular – seems unlikely to dim anytime soon. A recent Forth report shared some striking mental health statistics, revealing that, in the UK, ‘How to reduce stress’ is Googled once every 10 minutes, on average, while one in seven UK adults reports that their mental health is currently either bad, or the worst it has ever been.

Across the insurance industry, there has been a strong shift towards incorporating mental health into the insurance proposition, in part driven by increased understanding of the importance of a healthy work-life balance and growing customer demand for holistic wellbeing solutions. A recent example of this came from Aviva’s enhancement of its personal accident and business travel offering which added a range of wellbeing benefits including a line manager toolkit for mental health and access to a counselling service.

Head of crisis management at Aviva, Luke Powis (pictured), highlighted research from the insurer which found that one in six (17%) business leaders cited the mental health and wellbeing of their staff as one of their biggest risks, up from 14% of businesses last year.

In the SME and mid-market space the situation is particularly challenging – often managers are promoted into leadership roles without receiving any formal training on how to support their teams. “We know there are tens of millions of these leaders across the UK and Europe who don’t even know how to identify let alone help support their employees through mental health challenges,” Powis said. “[The offering] is also really popular with our more traditional corporate clients because it’s helping their HR teams tackle this risk which is becoming more prevalent.”

Whether it’s gym discounts, cancer care products that extend to wider family, nutrition advice or support around financial planning, there’s a myriad of ways in which insurers can support insureds in developing a holistic wellbeing package. In the past, these products have tended to be very reactionary but it’s clear that there is scope for more proactive wellbeing solutions that help insureds mitigate their risk without incurring significant costs.

Opportunities for insurance brokers

The move to embrace more proactive solutions presents a range of opportunities for insurance brokers including the chance to enhance client relationships by delivering more relevant and timely products and services, and to create new revenue streams. However, it’s a shift that also presents several challenges for brokers, including having to adapt to these new products and grapple with increased complexity with regard to both client education and regulatory compliance.

A core challenge facing insurance brokers is how to communicate the strength of new insurance solutions in the limited time frame they have allocated to speak with clients – particularly in the SME and mid-market space. It’s further complicated by the complexity and breadth of modern insurance offerings as the diversity of products continues to advance.

For Powis and his team, the balancing act is creating an offering that’s competitive on a commercial basis but also provides something extra to clients’ existing employee benefits offering. That has meant distilling the solutions down to the core components, he said, which in this case are four central pillars of counselling, mental health training, gym and nutrition discounts, and static literature about wellbeing.

“If you go beyond that, brokers start getting distracted,” he said. “Our set strategy, is that our underwriters will have three bullet points to pass over to the sales team. That’s the messaging that they’ll pass to the broker, who might pass it on to a junior broker, who will pass it on to the risk manager, who passes it on to HR.

“It’s easy to lose the message if you’re not clear about your message.”