In this episode of Risky Business, Colin Rooke and Paul Martin talk about the positive outcome as a result of listening to your employees and putting their needs first, when it comes to benefits and incentives.
Listen to the full episode here, or read the full transcript below
Paul Martin: Welcome to Risky Business, Commercial Insurance with Butler Buyers. This is Paul Martin. You hear me as a business commentator on this radio station. And you hear me talking about the Butler Buyers risk assessment system. Well, we continue that conversation and joining me, as always is Colin Rooke, the commercial risk reduction specialist with Butler Butler Buyers Commercial Insurance.
Paul Martin: Last time we talked Colin, we started to touch on the topic of benefits plans. Normally in this conversation we’ve been talking more about insuring property and liability, this kind of stuff, but we talked about benefits plans. I want to talk about that a little bit further. And tied in that with benefits is something you refer to often as employee engagement. And I’m curious about that. Why someone who is worried about insurance for my building actually would even have in this conversation questions such as employee engagement. Can you walk me through how those two are correlated?
Colin Rooke: Yeah. It’s a good point you bring up. Butler Buyers Insurance has a benefits division. I myself do not sell group benefits but we often, you know, if we’re doing a risk assessment, if it’s brought on by our benefits side, then we’ll bring the property casualty side and vice versa. And the reason why we do that is ultimately with our risk assessments the point is to improve company performance. We want to worry about risks so our clients don’t have to and the reason why we wanted to talk about the correlation between the property casually discussion and the benefits is a lot of what we talk about and the reason why we tend to do things together, we’re having the same conversation.
Colin Rooke: If we’re talking about employee engagement from an operation standpoint, yes, if you focus on having happy, healthy employees, you’re going to get more out of those employees from a production standpoint. So our job is definitely to identify and discuss the cost of doing nothing we say a lot of times.
If you focus on having happy, healthy employees, you’re going to get more out of those employees from a production standpoint.
Colin Rooke: But on the benefits side of the equation, engagement is directly tied to a claims. And so if you’re a business owner that is paying property casualty insurance premiums, I’m guessing you’re also paying a sizeable group benefit premium. So if we can in the same conversation talk about different topics that again, cross over both sides, not only can we help our clients in in two ways, but we can also again, use that information to negotiate a more favorable terms for our clients.
Paul Martin: That’s interesting because effectively I hear you’re saying a company is more its buildings or its liabilities and when you’re looking at insurance as a program, you have to look at the whole company, not just the value of the property. But in fact, how does the company work? What’s the employees? It’s a much more holistic approach.
When you’re looking at insurance as a program, you have to look at the whole company, not just the value of the property. But in fact, how does the company work? What’s the employees? It’s a much more holistic approach.
Colin Rooke: Yeah. You know, we focus on who’s inside that company and it’s who’s inside that company that really do dictate the costs associated with running that company. Again, especially from a commercial insurance property casualty standpoint. And definitely from a group benefits standpoint. Again, if you’re aware of how your employees are feeling and if they feel that management is in tune with their goals and they’re in that workplace that they’re happy to be a part of, the research shows that claims will decrease. And again, if you’re a company that’s been paying benefits premiums you’ll know that as claims decrease, your premium decreases.
Colin Rooke: So we talk a lot about ways to save money and in a part of every risk assessment, whether benefits is a part of that or not, we do ask how do you manage the rising costs of employee benefits? And a lot of companies will say well, we’ll go to market and we’ll see who’s competitive just like property casualty insurance. And then often they’ll say, so I assume that’s why you’re asking that question. You’d like to go quote out the benefits.
Colin Rooke: And we say no, what we want to know is really what is your stance on managing those costs? What are you doing about them? If your premiums are rising every year and there’s drugs on the market that will cost a company over a million dollars a year. And when you look at the benefit of that drug, it seems like very little but it’s a lot to the person taking that drug.
Colin Rooke: And so when we talk to clients about managing those costs, we truly mean it. So our job is to implement strategies that say okay, let’s work on how people are feeling. Let’s work on skillset. Let’s work on pairing the right people and the right tasks. And if you do, that will lower your benefits premium.
Paul Martin: In the business parlands today, what you talked about, matching the right people with the risk tasks, I think one of the buzz words is getting the right people on the bus and getting them in the right seats on the bus.
Colin Rooke: Yeah, we use that a lot too. There’s only so many seats on the bus.
Paul Martin: And that comes from Jim Collins, Good to Great. Now, who would have guessed that the book Good to Great, which is for some people, a bible of how to run your business, actually fits into this conversation we’re talking about here?
Colin Rooke: That’s right. Yeah.
Paul Martin: But the why are definitely correlated.
Colin Rooke: Well, and that’s exactly it. And we use that term all the time. There’s only so many seats on the bus. So again, we’re not saying, we’re not telling our clients, okay, identify the good from the bad and then any bad throw off the bus. But what we are saying is if you focus on those people, if you focus on finding people in the right seat, on the right bus, engagement will improve and as a result, you are, as a company, a lot less likely to have not only property casualty claims but benefits as well.
Colin Rooke: And again, it makes complete sense when you think about it. You have people that are happy doing what they’re doing. They feel they’re working with a company that how they’re feeling matters to that company. They’ve got a great work life balance. Whatever the reason, they’re more likely to treat the company they work for like they’re owners within that company. And if you talk to any business owners they’ll say no one cares about my business like I do because I’m the owner, I have skin in the game. That might be true, but as close as we can get those employees to that level, the better the performance of that company.
Paul Martin: I get why as a business owner I would want to do what you just laid out, create better engagement. But why does an insurance company care?
Colin Rooke: I mean, at the end of the day, they don’t want to pay out claims. The client doesn’t want to go through it. The client doesn’t want to pay the deductible. The client doesn’t want to pay increased premiums. No company enjoys the rising cost of employee benefits. I mean, I don’t think anyone gets excited when you say your costs are going up 25% over the last year.
Colin Rooke: And that’s true for the insurance companies. I mean, their job is to help financially transfer risk and our job is to pair the companies that we work with with the appropriate insurer. But again, their job, their goal is to not pay at all. So if we can provide reason for them to believe that year they may not pay at all or they’re a lot less likely to pay they’re a lot happier. They’re more engaged, to use that term, they’re more engaged with the risk. And we find that all the time that when we discuss a certain class of business, as soon as we say the name we’ll get a no. Nope, we will not take that class of business.
Colin Rooke: We say hold on, let me tell their story. And nine times out of 10 we can change their tune because we took a category, a grouping and we’ve made them desirable. We were able to break our clients free from that pack and say judge them for who they are, judge them for the story that we told. Judge them on the work we’re going to do with the client on an ongoing basis. Don’t pool them into a less than desirable category.
Paul Martin: All right, we’ve got to take a little break. We’re going to be back and pick up this conversation. You’re listening to risky business. Joining me as Colin Rooke, the commercial risk reduction specialist with Butler Buyers Commercial Insurance. Back after this.
Paul Martin: Well, welcome back to Risky Business. This is Paul Martin joined today by Colin Rooke commercial risk reduction specialist with Butler Byers Commercial Insurance. Colin before the break we were just starting to dig in a little bit into the role that your risk reduction program, your step-by-step plan that you’ll walk a business owner through, how it can impact not just the property casualty side of the insurance, but actually look at, what they’re paying in benefits. And if I heard you right you said you can take a look at this. You can actually figure out ways to lower premiums, but you don’t have to lower benefits or cut the program to the employees as a part of this process.
Colin Rooke: That’s right. When we, again back to the topic of managing the cost of employee benefits. Our job is not to say, well, let’s find a market that will reduce cost by 2% to 3%, or maybe on the benefit side the servicing fees are lower. So there’s some savings there.
Colin Rooke: Another way to do it is say, well, we can start nipping and tucking some of these benefits that your employees enjoy, which that’s not always a great thing either because some of the employees that will, be working for you at that time, they may have joined the company based on the benefits that you were providing.
Colin Rooke: So, I mean that’s not the solution. The real solution is going from focusing on treatment to prevention. Taking a stance as a company owner and saying, we don’t want to be paying these high premiums. So what can we do internally to reduce that, but again overall and the true benefit is company performance.
Colin Rooke: Normally when clients go through our risk assessment system, initially we’re gathering information and we compile that information and we put into a plan and we’ve talked about that at length. And then we sit down with the client and we say, okay, we’ve heard what you’ve said, we’ve organized the risk and we’ve prioritized the risk, and now we’re going to talk about the cost of doing nothing.
Colin Rooke: So normally we haven’t done this on the show to date, but I want to share some statistics for you, and I really I’m hoping that business owners out there will say, well, this will be an eye-opener. So for example, if you design jobs in correlation with employees skills in interest, that can reduce claims up to 87%, and that’s just people working in areas that they genuinely want to be working in.
Colin Rooke: Another one, offering work-life balance opportunities. 77% reduction in benefits claims. Recognizing employees good work. A pat on the back saying, Paul you did a heck of a job on the show today. You’re 74% less likely to put him to claim because we just had that conversation. Offering or promoting adoption of physical activity such as sport, jogging, walking.
Colin Rooke: I mean, we talk about employee wellness risk all the time. How are you creating a culture of wellness within your organization? 69% reduction in claims. Implement strategies designed to help employees maintain a reasonable workload. 64%. Again, and this is another risk we talk about all the time, employee policy and procedure risk. When you hear those numbers, I mean, this is a very recent study done by one of the largest benefits providers in the world.
Colin Rooke: And that just shows, having that conversation about risk, because you’re not going to work on these risks if you’re not aware of them. If you’re not aware of the costs, you’re not going to work to improve them. So having that cost about risk, letting us know where you’re at, working together and coming up with a plan of attack, and seeing those numbers saying, geez, well, I can put employees in the right job for the right skill set. I mean that’s an easy thing to do and it’s probably something I should be doing. 87% potential reduction in claims. Those are powerful numbers, powerful savings.
Paul Martin: And you will walk a business owner through these individual items. That’s a part of your step-by-step plan, right? You will sit down with the owner and say, I have some specific questions and as you answer them we’ll be able to identify, where you’re strong, where you’re weak, and then any potential program we could put in place that would make your weak spots get better and stronger, and that, that helps you then spin your story to the insurance company.
Colin Rooke: Exactly. I mean, that is the point of this system, to walk our clients through the path of success. We want to work on risk with our clients and we’re going to use that work to ultimately negotiate as well.
Paul Martin: So when you lay out figures like the ones we just did, what struck me with that is, as a business owner I don’t know what I don’t know. Your job is to bring that knowledge to me and say, did you know that if we did this we might have a potential reduction in claims of 87%.
Colin Rooke: Great point because, when a client goes through our assessment system, it’s not a one-time thing. We review either annually, by-annually, semi-annually, or even quarterly if we need to, but our work doesn’t stop. Our job is to look for new and emerging risk. Our job is to find articles like this and then look at our portfolio of clients and say, okay, who needs to know this? I would argue with this, the benefit stats almost every single one of our clients.
Colin Rooke: But and again, you don’t know what you don’t know, and our job is to learn and focus on risk and that is our job. Our clients are busy running their companies. They’re not searching for this stuff. It is our job. This study I was made aware by one of the listeners of the show.
Colin Rooke: And so I got an email. I explored the link in … I went through it, made some notes, did some further reading and again, that alone that now this is going to be part of our assessment. It’s going to be part of the advice that we give to our clients, but that’s all part of the learning process, and that’s what we’re doing at Butler Byers. We’re learning about risk, so we can help our clients reduce it.
Paul Martin: So if I could summarize it this way and maybe this is the point of this whole series of programs called Risky Business that we’ve been doing, is you don’t just bring prices to clients, you bring information.
Colin Rooke: Exactly.
Paul Martin: It’s a whole different approach. The price comes later, but let’s digest the information and here’s what you don’t know and I do because I’m an expert in the field, is what you’re saying to your client.
Colin Rooke: Exactly and when we work with a new company, a new business to us, we almost never quote and when we do it’s usually because there’s a direct writer involved. So it’s not the broker channel they’re working with. And that always surprises client. So, you don’t have a market or you don’t have a trick up your sleeve to save us money and we might, but true savings exist when you put in the work.
Colin Rooke: So we’re going to say, look, you’re not any different now than you were yesterday. We’ve gone through this assessment, we’ve learned a lot, and we might make some immediate changes to your current program with your current insurer who at the time would know more about your company than the traditional market, so we can impact the policy right away that way, and often we can reduce costs due to items that are within that policy, but when it comes to true negotiation power, we have to have a track record. We have to say, this is where we started and this is where we’ve got to and here’s the plan. So again, it’s not uncommon to say, we’re going to work with the existing insurance company. The real work is working on the risk.
Paul Martin: And we’ve only got maybe a minute left here to talk about this. But I just want to reinforce a message you brought forward earlier that you’re much more interested in prevention than treatment. Prevention of claim than the treatment of the claim if I can put it that way. Just strikes me that, one of the topics we’re hearing about more and more it’s in our face all the time is, mission zero and safety in the workplace and safety at home. That’s really along the same line, isn’t it? It’s prevent mishaps and then you don’t have to worry about the consequences.
Colin Rooke: Exactly the right point. It’s if we commit to a culture of safety or we commit to a culture of wellness, we can stop the inevitable from happening, or we can definitely reduce it. And that’s the point of the work.
Paul Martin: Colin thank you very much for joining us today. As always the time seems to go by so quickly. And as I say at the end of every one of these shows, every one of us in business feels as though we pay too much for insurance, but meeting with Colin doesn’t cost you a single thing, and spending an hour with him, I’m confident that you will learn something that will benefit your business practices, and in most cases he will identify risks that you hadn’t even thought of, and ultimately that will lead to a reduction in premiums. I’m Paul Martin for Butler Byers Commercial Insurance. Again, call Colin, it’s one of the best business decisions you’ll ever make. You’ve been listening to Risky Business. Thanks for joining us.