The Benefits PEOs Bring to Insurance Agents

The Benefits PEOs Bring to Insurance Agents

January 23, 2018 | By Tailored Solutions

Do you view PEOs as competition to your growing book of business or a valuable resource? If you haven’t been using Professional Employer Organizations as a tool that can help you build your business, it may be time to take a fresh look at the benefits PEOs bring to independent agents and their clients.

What Insurance Agents Should Know About PEOs

Professional Employer Organizations (PEOs) form co-employer relationships with an employer and typically take over many of the duties related to employee-management, such as payroll, human resources, benefits, and the management of workers’ compensation.

Because PEOs provide workers’ comp and health benefits, some independent agents view these organizations as a threat to their existing and future client base.

However, many brokers and agents have realized the opposite is true: that working with PEOs provides an opportunity to fend off threats to current clients, plus provide creative alternatives that can actually help build their books and increase retention.

Here are a few of the benefits you can experience when you begin offering PEOs to your clients:

Protect Your Client List

If your client hasn’t heard about the benefits of a PEO yet, they soon will. PEOs offer better services and benefits for employers and employees than small businesses typically can get on their own. Businesses that partner with PEOs have higher survival rates, higher growth rates, and lower employee turnover than comparable, non-PEO businesses.

And business owners who are experiencing these benefits are happy to talk about it:

98% of business owners who are PEO clients would recommend a PEO to a small business colleague.

The National Association of Professional Employer Organizations (NAPEO) estimates there are currently as many as 980 PEOs operating in the U.S., providing services to as many as 3.4 million worksite employees. The annual growth rate for the PEO industry for the past 5 years (2012 - 2017) was 10.69% and is projected to grow by 2.6% annually through 2022.

In other words, PEOs are growing and PEO clients are satisfied with their partnerships.

If you’re not offering PEOs to your clients, it’s likely that either other agents will or that your clients may start seeking out PEOs on their own after hearing a glowing recommendation from a client.

You’ve invested an incredible amount of time and resources into your existing book of business. Don’t lose established clients because you’re not bringing a PEO solution to the table.

Get More Creative with Comp

When the voluntary market is out of the question for your client, PEOs may provide an attractive alternative to state compensation funds.

High Mod Scores

When an employer forms a co-employer relationship with a PEO, the employer assumes the PEO’s mod. And that can be an instant cost saving benefit for your clients with high experience mods.

If you’ve seen workers’ comp claims piling up, be proactive. Let your client know that the next year’s renewals are going to increase.

Then let them know that, when that happens, you plan on quoting them out to PEOs as well as the voluntary market to make sure they’re getting the best solution and most affordable rates.

High-Risk Industries

Prospective clients in high-risk industries and class codes can be hard to place. And these clients often find their quotes hard to swallow.

Let your client know that you have an alternative solution; one that may reduce their workers’ comp premiums and free up more cash flow at the same time.

PEOs provide pay-as-you-go workers’ comp with no upfront premium deposits. Your client could save big with a PEO relationship by avoiding huge deposits, saving on premiums, and eliminating end-of-year surprises like additional premiums due.

When you offer PEOs to your clients, you provide an alternative solution to some of their biggest workers’ comp problems. And that solution may also solve some of their other business challenges, as well. That’s a solid way to stay ahead of the competition and solidify a good relationship with your client.

But how do you get started finding the right PEO solutions for your clients?

Working with a PEO Broker

The best part of adding PEOs to your product offerings is this:

When you work with a PEO you don’t have to invest more time or do more work to find the right market for your client.

At Tailored Solutions, we’re a licensed wholesaler with relationships with some of the top rated PEOs in the industry. And we specialize in niche markets. We work with agents to find the best PEOs for their clients’ niche and individualized business needs.

Our simple process ensures that you not only get a PEO quote to provide to your client, but you also get the best possible solution for their individual business and all of the support needed to close the sale and service the account.

You don’t need to decide which of the 900+ PEOs in the US has the right program for your client. And you don’t need to submit the same application and have the same call with sales reps over and over to get the best quote.

While you shop the open market, Tailored Solutions can shop the PEO markets on your behalf.

The workers’ comp market is already highly competitive. Some of your workers’ comp leads will be straight forward, simple, and easy to place on the voluntary market. But some of your leads won’t be so simple.

In these situations, you can set yourself apart from the competition by offering a PEO solution to your high-risk, high mod, or other hard-to-place clients. PEOs don’t have to be competition for independent agents.

When you partner with a PEO wholesaler like Tailored Solutions you can have a team of PEO professionals working alongside you to keep your clients happy, satisfied, and on your books.

PEO Ready

Become a Producer.