Review of Long-Term Disability Plan Secures Reduction to Core Plan Rates

Case Study

The Request

Review the financials and claim management of the Long-Term Disability plan to help identify opportunities for improvement

Company Profile
Industry: Telecom
Number of Employees: 40,000

A telecom company requested that Brown & Brown review both the financials and claim management of its Long-Term Disability plan to help identify opportunities for improvement.

The Solution

Released an RFP to the market to help improve claim management moving forward

Brown & Brown’s Strategic Non-Medical Solutions team initially examined the current claim metrics to past baselines. By leveraging data across extended periods and prior carriers, it became clear that claim handling performance metrics had begun to decline. The current carrier had missed performance guarantees, and claimant complaints were rising.

While still attempting to remediate the relationship, the team determined releasing an RFP to the market would achieve a comprehensive outcome. By pulling together the customer’s past four years of experience prior to the incumbent carrier’s involvement and current run date, the Brown & Brown team built a combined experience exhibit for bidding carriers.

By providing this information, bidders understood how the experience would have performed with more aggressive claim management in the past. With this insight, the bidders determined how the plan would run under their claim administration.

The Results

Secured a reduction to core plan rates and no increase in its renewed voluntary buy-up rates

This detailed claims comparison between prior and current carriers allowed the Brown & Brown Strategic Non-Medical Solutions team to have a dialogue with bidders, giving less weight to the most recent two plan years when case management was inadequate.

As a result, the customer secured a 31% reduction to core plan rates versus the incumbent carrier’s original request for a 25% increase. Additionally, they renewed voluntary buy-up rates “as is” versus the incumbent’s requested 20% increase.

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DISCLAIMER: Brown & Brown, Inc. and all its affiliates, do not provide legal, regulatory or tax guidance, or advice. If legal advice counsel or representation is needed, the services of a legal professional should be sought. The information in this document is intended to provide a general overview of the topics and services contained herein. Brown & Brown, Inc. and all its affiliates, make no representation or warranty as to the accuracy or completeness of the document and undertakes no obligation to update or revise the document based upon new information or future changes.

DISCLAIMER: Brown & Brown, Inc. and all its affiliates, do not provide legal, regulatory or tax guidance, or advice. If legal advice counsel or representation is needed, the services of a legal professional should be sought. The information in this document is intended to provide a general overview of the topics and services contained herein. Brown & Brown, Inc. and all its affiliates, make no representation or warranty as to the accuracy or completeness of the document and undertakes no obligation to update or revise the document based upon new information or future changes.