By Cyril Tuohy
Texas, Florida and California led the way for new voluntary sales in 2012, with Kentucky and South Carolina joining the top 15 states, according to data on the voluntary benefits market tracked by Eastbridge Consulting Group.
Maryland and Massachusetts dropped out of the top 15 last year, according to the Eastbridge Sales Index (ESI).
Gil Lowerre, Eastbridge president, said that even in states with the top sales numbers, there’s still plenty of room to grow. Advisors and brokers shouldn’t assume that just because a state is in the top group for sales, markets in those states are saturated.
“As an example, for 2012 (and in 2011), California and New York are in the highest sales category (third and fourth place respectively), but in much lower ESI categories, indicating that there is untapped potential in those states and not the saturation that some carriers may perceive,” Bonnie Brazzell, Eastbridge vice president, said in a statement.
Delaware, Arkansas, Kentucky and Tennessee had the highest ESIs, even as two of those four states were not included in the top 15 as measured by sales of voluntary benefits premium. “So even though these states had lower sales, their voluntary sales saturation is higher and future sales opportunity lower,” Brazzell said.
The voluntary benefits sales index is published annually by Eastbridge. It is used by advisors, distributors and marketing specialists as a snapshot of the penetration of voluntary benefits reaches into different markets.
Results for 2012 appear in Eastbridge Consulting Group’s third annual U.S. State ESI and EPI Data report.
In addition to the ESI, Eastbridge issues the Eastbridge Premium Index (EPI), which measures in-force premium per employed person. When the premium index is combined with the sales index, carriers get a more accurate picture of voluntary benefits sales growth, Eastbridge said.
Voluntary benefits have been growing at a healthy clip over the past few years. As health plan sponsors hike deductibles and co-payments, employees see value in voluntary benefits, even if they have to pay 100 percent of the premium.
Sales of voluntary products for 2012 were up 6.6 percent over 2011, with total new business premium exceeding $6 billion according to Eastbridge’s annual U.S. Worksite/Voluntary Sales Report.
Cyril Tuohy is a writer based in Pennsylvania. He has covered the financial services industry for more than 15 years. He can be reached at [email protected].
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