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UNDERSTANDING YOUR GROUP BENEFITS

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By Belinda Sullivan, head of corporate consulting strategy at Alexander Forbes

 

Your group benefits package provided by your employer can provide a range of products and services, which can safeguard both your financial, physical and emotional well-being. However, not all benefits packages are equal.

Your group benefits package provides holistic financial and health support for you and your entire family. It’s not limited only to the workplace. Typically, an employer makes available employee benefits which include a retirement fund, insured group risk and healthcare benefits, with additional advice and assistance within the workplace to balance your short-term needs and long-term objectives.

The benefits of employers providing such benefits is that employees can be pooled to provide better terms and conditions and to reduce costs to individuals in securing these benefits. This is due to economies of scale as part of the overall group.

According to the Mercer Covid-19 Employee Health and Benefits Pulse Survey, which collected perspectives from African companies on the impact of the pandemic on employee health and benefit policies, 64% of those surveyed anticipated significant changes to these strategies as a result, and 50% of companies indicated they planned to implement budget changes for health and wellness benefits.

Your employer will personalise the benefit package offered based on an array of benefits, selecting the benefits they believe will meet the needs of their employees. It is important to understand the benefit offering to use the benefits, as some may even be optional.

Set out below are some benefits that your employer may offer and what they mean to you and your family:

Life cover for your spouse
In addition to life cover that pays out if you pass away, you can also cover your spouse under the same policy. This means that if something should happen to either breadwinner, your family is protected.

Education benefit
This benefit covers the education and living costs of your minor children should you pass away before retirement age. This is a crucial complementary product to normal life cover, as it ensures your children’s future.

Medical aid

Having access to quality healthcare is something that no person should take for granted. Your group benefit package could include a range of healthcare options, from which you could select an affordable option tailored to your and your family’s requirements. Advice is important to meet your needs adequately. You need to review the options every year.

Mental and emotional support
Modern life is stressful, and statistics by the World Health Organization (WHO) show that mental and social disorders are rising rapidly. This has been exacerbated by the pandemic, which has seen a significant rise in anxiety, depression and even suicide. The South African Depression and Anxiety Group has noted a 47.75% increase in calls since 2020 for the first nine months of 2021. Most employers offer employee assistance programmes which support employees’ emotional, financial and physical well-being, giving them access to confidential counselling and other support.

Gap cover

With increasing medical costs above medical aid rates, this insurance provides for the difference between what your medical aid pays and the rates charged by medical specialists for in-hospital procedures. This can help to ensure that you are not left with a large excess amount to settle. Gap providers offer discounted contributions for groups, which is based on the group’s risk profile and participation policy, which could be compulsory or voluntary. 

Retirement fund

A retirement fund aims to provide employees with an income in retirement based on their accumulated savings. This retirement income replaces all or part of the money they were earning before retirement. The income they earn in retirement depends on how much money is saved to retirement.

Tax exemptions offered encourage employees to save through the retirement fund. Where an employer has a retirement fund in place, all employees are obligated by law to belong to the retirement fund as a condition of service.

Retirement funds also offer you access to default retail solutions in retirement which may be priced at group rates.

Group risk benefits

Your group risk benefits, such as life and disability cover, are generally priced at institutional rates. This means you benefit from lower fees due to group economies of scale. You would not necessarily have access to this pricing without going for a medical if you tried to source this in your individual capacity.
Advice
The financial advice you receive will always be tailored to your and your family’s particular needs and circumstances. Education and advice will help you to become financially savvy and have higher levels of financial courage to improve your financial situation.
This will further promote both your financial and physical well-being. It is therefore worth taking the time to fully understand the benefits your employer offers, and make full use of them.

 

 

Top 10

IF IT’S A LOSS, YOU’RE TOO LATE – WHY THE INSURANCE INDUSTRY NEEDS TO FOCUS ON FIRST NOTIFICATION OF RISK

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Simon Dicks, Insurance Channel Manager EMEA, Lytx

 

Insuring commercial fleets can be an expensive business. Average repair costs have increased by up to 40% in the past 8 years and disputes about who was responsible can drive up expenditure for both fleets and insurers.

Part of the problem is that the insurance industry hasn’t had the tools to forecast costs and premiums accurately enough in this sector. Underwriting decisions are still made in the same way they always have been, by looking back at historical data from previous years. This approach simply isn’t giving insurance companies an accurate indication of potential risk – or a proper indication of the impact of driver behaviour.

Technology is helping insurers to an extent by providing information about First Notification of Loss (FNOL) – automatically sending notifications when unusual G-force readings are captured within a black box tracking device as a result of sudden braking or impact. This is good, but far better is the ability to use proactive technology to detect when an incident is at risk of occurring and when a driver is distracted.

The only way to address this is to put a highly accurate level of camera technology both inside and outside cabs, supported by sophisticated technologies such as Machine Vision (ML) and Artificial Intelligence (AI). This way, we can see not just that an incident has happened, but why it happened. What’s more, we can assess risk before an accident happens at all and prevent it happening in the first place. We call this First Notification of Risk (FNOR) – and it’s a whole step up from FNOL.

Machine Vision scans the internal and external environment of the vehicle to identify distracted driving behaviours such as mobile phone use, eating, drinking, smoking, inattentive behaviour or failure to wear a seatbelt. AI, comparing the behaviour against a vast bank of accumulated data, is then able to determine the riskiness of that situation and whether it needs to be flagged to the fleet manager, driver, or insurer via a short video clip. The big difference in this approach is that it’s proactive, not reactive. For the first time, fleets and insurers can identify adverse driving and distracted driving in real-time for the first time.

This includes the ability to alert drivers of any momentary slip-ups or distracted behaviours. Using the same technology, drivers will receive an audio or visual alert to help keep them on track and to lessen the likelihood of a moment’s distraction becoming anything more.

When insurers have access to these insights, they can also start to see patterns from the data over time. For example, a fleet manager might start to see that there’s a peak in risky driving behaviours on a Friday afternoon when lots of drivers are rushing to finish for the weekend. As a result, they may decide to spread the shifts differently so as to avoid that pattern of behaviour.

When insurers are only looking at FNOL, it’s already too late. A driver could be unthinkingly driving whilst smoking, on their phone, and nobody would never know. Whereas with FNOR, both managers and insurers are provided with insights that remove the guesswork, and underwriters have the information they need to assess risk with far greater precision.

There’s still a long way to go in making the move towards FNOR. With so many different companies selling cameras and telematics systems and producing information in hundreds of different formats, claims data will have to be standardised before the sector can really transform. However, by starting to embrace ideas like FNOR, the industry can move towards a solution that saves them time, money and lives.

To find out more, visit  www.lytx.com/FNOR

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THE DIGITAL WEALTH, ASSET MANAGER AND FINANCIAL BROKER OF THE FUTURE: TRANSFORMING CLIENT COMMUNICATIONS

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By Christina Di Nolfo, Head of Solutions at Delta Capita

 

More than in any other profession in financial services, wealth managers and financial brokers are heavily dependent on personal interaction with their clients. While digital transformation has been on the agenda of many individual advisors for years, the pandemic revealed the painful inefficiencies of legacy communication models.

Studies from YChart mirrored the communication gap just a year prior to the lockdown. 75% of clients want proactive communication from their wealth manager or advisor. But nearly half of clients with over $500,000 or more in AUM said they received infrequent communications, with those with less than $500,000 invested, receiving even less of their advisor’s time.

Consequently, finance professionals have been quick to try out any communication software from Zoom to Slack to WhatsApp. However, these programs were not made for financial advisors, making adhering to compliance standards more complicated than ever and raising security concerns.

Christina Di Nolfo

Let’s take Zoom as a quick example. Whilst Zoom is a great communication tool and one which many of us are all too familiar with, it is only meant for video calls and is not a comprehensive communication platform. The Federal Trade Commission discovered that Zoom’s end-to-end encrypted (E2EE) wasn’t what it appeared to be. Instead of calls being E2EE between participants, the data was only encrypted between each meeting participant and Zoom’s servers – meaning it was not truly end-to-end encrypted.

But it’s not just Zoom. Any application not built with compliance in mind is a risk for your business and your customer.

A customisable, compliant, and fully interactive client portal for the digital wealth advisor or financial broker is essential to streamline communications and maintain compliance. But what does that look like?

 

The Wealth Manager of the Future

Customer experience is everything, and the wealth manager of the future can already benefit from an end to end digital customer journey platform. Imagine if you could:

  1. Onboard new clients in minutes
  2. Push secure content to your client on their chosen device
  3. Record every minute of your meeting, even as you switch between video, chat, screen shares, and more
  4. Collect signatures and obtain consent instantaneously
  5. Accept PCI compliant payments directly from your portal
  6. Provide disclosures and other vital documentation for clients
  7. Collect customer documentation in real time such as ID and proof of address

All of this is possible through Klarion, our end-to-end engagement portal. Completely customisable, Klarion offers an entirely digital process designed for the optimal user experience. Clients are not required to download complex software. Instead, they only need to click on a secure link that you send to them via email or SMS.

Klarion enables you to verify identities in real-time, manage essential sensitive data, accept payments, engage in a video call and more. And you don’t need to worry about compliance. Not only does our solution log every interaction and timestamp it within an end-to-end encrypted environment, but you can also benefit from PCI-DSS Level 1 and KYC/AML compliance features.

You no longer need to go back and forth with your clients over email or other communication channels, as you attempt to resolve issues or complete tasks. And you also do not need to invest time and resources in tracking down every slip of paper. Instead, you can focus on what matters: Keeping your client informed about their assets and providing value.

Financial managers using Klarion have shifted their self-service offering from 13% to 30%, and reduced call volumes by 2.2x without sacrificing customer experience or compliance regulations.

 

The Future Won’t Wait

Through the proliferation of technology, more and more customers will demand a comprehensive and cohesive user experience. To create a sustainable, client-focused financial management practice today, integrating technology with human sensibilities is critical.

But waiting to reinvent your customer interaction process means that instead of focusing on growth, you may well end up running after the competition.

Klarion makes it easy to get up and running. There is no need to worry about costly, complicated, or time-consuming system consolidations, as Klarion integrates seamlessly with current infrastructure as a white label front-end solution, while ensuring your brand is front and centre. Klarion sends information directly to your CRM (or other systems), saving you from data entry duplication and is customisable to whatever workflow is required.

 

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