Case Study
Benchmarking and Financial Review Reveals 15% Annual Savings
The Request
Need for cost-containment strategies amid soaring Long Term Disability (LTD) rates
Company Profile
Industry: Biological Products Manufacturing
Coverages: Life, Disability, Supplemental Health, Leave
Covered Lives: 1,000+
The customer faced a 170% renewal increase for LTD coverage after marketing their plan. They needed a comprehensive plan design and financial review to identify cost-containment strategies and mitigate the impact of this significant rate hike.
The Brown & Brown Practice Lead requested a benchmarking and financial review analysis to uncover opportunities for improvement.
The Solution
Comprehensive review identifies gaps and unlocks savings potential
The Brown & Brown Non-Medical General Agency (NMGA) team conducted an in-depth benchmarking and financial review, resulting in customized recommendations to manage risk, control costs and enhance benefits.
Key findings included:
- The customer recently transitioned from a research company to a manufacturing company, changing their industry classification and risk profile.
- Current plan designs were misaligned with the new risk level.
- Basic Life and Long-Term Disability coverages were above benchmark.
- The customer faced exposure in 10 states with statutory disability plans.
Recommendations focused on aligning plan design with industry standards, leveraging surplus funds and reducing claims incidence.
- Suggested leveraging surplus from Life and Supplemental Health to offset the LTD increase.
- Voluntary Life heatmapping revealed only 13% of enrolled employees exceeded the guaranteed issue limit while 38% of those enrolled had coverage below the guaranteed issue limit identifying an opportunity for increased participation without Evidence of Insurability.
- Recommended LTD plan adjustments to improve performance while staying above benchmark.
- Proposed plan changes to reduce claims incidence.
The Results
Optimized costs and aligned risk for long-term success
15% Annual Savings Compared to Initial Renewal Premium
Achieved reduced renewal premium compared to initial renewal increase on Basic Life and LTD, delivering significant cost efficiencies year over year.
Enhanced Risk Strategy
Provided clear insights into how the updated industry code influences manual rates and risk assessment, enabling smarter decision-making.
Future Plan Optimization
Disability plan changes are currently under consideration to further strengthen benefits offerings.
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