Professional Employer Organizations provide workers’ compensation and health benefits as part of their comprehensive service package for clients.
Does that mean PEOs are competition for insurance agents?
The answer is a definitive no.
In fact, insurance agents who work together with PEOs find more opportunities for sales and increased profitability.
The relationship between PEOS and independent insurance agents has changed for the better in the past decade. Here are just a few of the reasons today’s most successful insurance agents love PEOs.
PEOs Provide Big Benefits to Clients
Professional Employer Organizations (PEOs) offer comprehensive HR solutions for small businesses, including management of:
- Workers’ compensation
- Employee benefits
- Safety training
- Compliance assurance
- And more
PEOs can bring the back office and benefits platforms of a Fortune 500 company to small- and mid-size businesses, like best in class health benefits, 401k, payroll, time and attendance, and competitive workers’ compensation. With a PEO partnership, business owners are freed from the non-productive tasks associated with employee management and can spend more time focusing on revenue-generating tasks, instead.
Businesses in high-risk industries or with high xMOD scores can typically save up to 40% of their premiums with pay-as-you-go workers’ compensation.
Bottom line? PEOs are good for business.
- 98% of business owners with a PEO relationship would recommend a PEO.
- 70% of business owners reported increased revenue after partnering with a PEO.
- 66% of business owners reported increased profits after partnering with a PEO.
Bringing a truly valuable service to your clients is one reason agents love PEOs. But the benefits extend to your own business, as well.
Here’s what you can expect as an agent who adds PEOs to your arsenal of products and tools.
Have you hesitated to recommend a PEO to your clients because of uncertainty or lack of experience? One reason agents love offering a PEO solution to their clients is the sales support they get when using a PEO broker like Tailored Solutions.
Today there are more than 700 PEOs in the U.S. But you don’t have to call up each and every one to find the right product for your client or spend all day dealing with multiple sales reps.
At Tailored Solutions, we have relationships with dozens of the nation’s strongest and most flexible PEOs. We work with you to find out what your client’s needs are, and then find the right provider with the perfect solution for your client’s individual strengths, weaknesses, and goals.
After we’ve done our job as your PEO broker, finding the right PEO solution for your client, we change hats and become your personal sales support team.
- You are presented with a proposal so you understand the quote, cost structure, service model, and potential for savings.
- You get sales assistance when presenting the solution to your client in the form of a virtual webinar.
- Your client gets all of their questions answered and the steps for setup explained.
- You close the sale with confidence and the support of our team of experts.
As an independent agent, there are three things that help your business and profits grow: finding new leads, closing sales, and servicing your accounts.
Independent agents report spending 21% of their time servicing their clients and only 9% of their time prospecting for new business.
Imagine reducing the time you spent each day servicing clients and having more time for prospecting and quoting new business.
When you pair your clients with a PEO, you get a full support team to service that account for you at Tailored Solutions. That means more time to focus on your own business growth without sacrificing or compromising the level of service your client receives.
How many of your commissions decline on renewal? One big benefit to partnering your clients with a PEO for workers’ comp is a consistent commission model that typically doesn’t decline over time.
PEO commissions are generally residual; you continue to receive your full commission as long as your client maintains their PEO relationship. Commission rates vary by state and by market, but typical PEO commissions are very competitive with the voluntary market.
Most agents find that partnering with PEOs increases client retention.
Your client came to you with a need. Most likely they were looking for workers’ comp coverage and were struggling with high xMOD or high premiums.
Not only did you solve their initial problem with a PEO partnership, but you also provided a “value add” by bringing them the additional benefits of a PEO, such as administrative and HR management. Whenever your client has a question or needs support, Tailored Solution provides an exemplary level of service on your behalf.
Your client is highly satisfied and considers you a trusted and valuable business asset.
Better Client Relationships
Building a better client relationship is easy when you are helping to solve your client’s biggest business problems, reducing premium amounts, and delivering high-quality customer service.
Now you can benefit from that relationship.
When your client trusts that you have their best interest at heart, they’re happy to bring you more business.
And happy to refer new customers, as well.
Referrals are the primary source of most independent agent leads; up to 60% of all new business for insurance agents comes from referrals. How many more leads will you uncover when you build better relationships with satisfied clients?
When you utilize PEOs to solve your clients’ workers’ comp challenges, you both win. It’s good for their business and it’s good for yours. That’s why the most successful insurance agents no longer view PEOs as competition but, rather, as a tool that helps them maintain a competitive edge in the industry.