Yesterday I walked out on a presentation I was invited to about changes in technology. This is not the first time I have done this. I have come to the conclusion that I have only so much time and power in my batteries and I won’t waste it on a boring and lack-lustre presentation. So what drove me out the door? The presenter spent most of his time talking to the screen effectively reading the script of the presentation to his audience. There was little interaction between him and his audience. He spoke in a monotone and just rambled on. The problem is that many workshops and seminars I attend look and sound like this. If you are going to spend financial resources on planning these kinds of events to attract new clients why not put the additional effort to captivate them by building a presentation that disseminates information in a way that uses humour, drama and gets the participants involved in the presentation. When you get in front of an audience and just read the deck it says you really didn’t prepare or you really don’t care that much. That’s a terrible message to send out to you audience. When choosing the member of your staff to give a public presentation pick someone who is confident and speaks well in front of people, not someone who is introverted and uncomfortable in public situations. You only get one opportunity to make a great impression and these kinds of interactions can work to attract to new business or send potential customers running in the opposite direction. I am sorry to say that more often that not I underwhelmed at the seminars and workshops I attend. People start putting more time and effort into your presentations.
I have held off writing this blog for quite some time because I simply did not want it to appear self-serving. The truth is there is a lot of fact and fiction out there regarding this simple but powerful product or as I call it contract for money. At the very basic level it can provide your family with money to carry on after you die. The simplest and least expensive form of Life Insurance is term insurance, but for a young couple with a few kids 10 year renewable and convertible term is the cheapest and best way to go. Once a couple has reached its 40’s the next best approach is to re-examine the need and then determine if it might be required for another 20 years. If that is the case I often recommend that 20 year term renewable and convertible might be the way to go. It is a little more expensive than a 10 year term, but over a period of 20 years will cost less than the renewal rate of your existing 10 term when it rolls over. The next question I am asked often is how much do I need? The simple answer is as much as you can afford without compromising other daily expenses you have to put aside. The truth is that if you are earning anywhere between $50-100,000 one million dollars of insurance is not a lot insurance. How can I defend that position simply because if one were to invest the principle at today’s low-interest rates the annual income would probably not be more than $30,000 gross before taxes. If one were to spend the capital amount of $1,000,0000 it would be gone in 10 years to produce a $100,000 living allowance to a family or 20 years if $50,000 was taken out annually. Just to demonstrate that the cost of $1,000,000 is not as expensive as you think I did a survey on some software I use to illustrate to clients competitive premiums from competing Life Insurance companies. A healthy 35-year-old non-smoking male would pay about $45 a month for $1,000,000 and a health 45-year-old would pay about $92 a month for that same coverage. A more complex but scientific way of calculating insurance needs can be calculated by working out a monthly budget that the family needs to live on and then figuring out the capital that it would take to sustain that lifestyle over certain amount of time. Other things to be aware of that you might or not need but that a commissioned insurance agent will show you is a waiver of premium rider which simply means that if you become disabled the insurance company will pay the premium of that policy. My take on this benefit is if you already have disability insurance through work or on your own then this additional rider may not be as valuable to you. There are sometime accidental death and dismemberment riders which I don’t have a lot of use for because the majority of deaths are by natural causes, so you are probably throwing your money away on this one. The other favorite rider you will be a small amount of life insurance on your children. I am kind of neutral on this one as the probability of losing a child at a young age is quite low, but the cost of funerals has been quite inflationary, so you may want to give this one some consideration. That is all for today. In a future article I will talk about the upside and downside of permanent insurance and how to use life insurance for estate planning purposes.
What’s the future of health benefits in Canada? A hybrid model of core coverage and personalized benefits is a likely scenario, speakers at an event in Toronto said on Wednesday.
“Our vision is really a hybrid model, where you have this traditional benefit program there to support your employee should something happen, something unpredictable that could have a big financial impact on their life, but combined with this broader view and their well-being,” said Julie Duchesne, a partner and leader of Mercer’s health business.
Duchesne made the comment as she and colleague Brian Lindenberg presented their insights at the Toronto instalment of Mercer’s second-annual series of events on the future of health care at the Ritz-Carlton hotel.
Last year’s event featured seven predictions for the future of health care by 2025. They included an estimated 130 per cent increase in health-care costs and the rise of personalized medicine like pharmacogenetics.
“It was an eight-year prediction window, so we’re year one into our predictions. We actually feel pretty good, generally speaking, about our predictions. We feel we’re kind of on track and as the future unfolds, it will unfold in a way that’s consistent with what we’ve predicted,” said Lindenberg.
One prediction that missed the mark, he noted, was around public health-care reform and pharmacare, which Lindenberg said in 2017 would never happen in Canada.
“Clearly, we might have missed a sign. But in our defence, a lot of people missed that same sign. Clearly there’s an increased enthusiasm for implementing the national pharmacare program,” said Lindenberg.
Speaking to the need for personalized benefits, Lindenberg referenced the issues of rising costs and the war for talent, both in terms of attracting and retaining employees.
“The game is clearly changing. In order to win that war for talent, we strongly believe you need to engage your workforce in a different way. You need to acknowledge the individual preferences of each of your employees and future employees. You need to leverage technology and what’s happening in terms of the vendor landscape to deliver a more personalized approach to your employees within the context of the age of the individual,” he said.
According to Duchesne, gathering data is key to developing a personalized approach and implementing targeted benefit programs. Targeted programs are essential to meeting the needs of multiple generations of workers and setting organizations apart, she said.
According to a global survey by Mercer conducted in 2016, 96 per cent of employers collected data but only 45 per cent used it in support of decision-making processes. Duchesne noted there are many different forms of data in the benefits field, including information about disability, use of wellness and employee assistance programs and demographics.
“The first opportunity we see is making sense of all that data through what we call data analytics. This is really important in order to better understand your workforce, your demographic and where you should invest in order to best control your costs over time,” said Duchesne.
According to Lindenberg, an important data set for plan sponsors and employers is around what employees want, need and feel they’re receiving. He noted a recent survey that suggested employees value health more than wealth or career progression.
“Close to 50 per cent of your employees would like to see you invest more in workplace wellness. That’s what they need. However, your employees are also skeptical. Thirty-seven per cent of your employees don’t expect you to invest a whole lot more within the next two years and only 19 per cent think you’re investing enough,” he said.
Noting the disconnect between what workers need and what employers are offering or able to deliver, Lindenberg said knowing where to invest in wellness goes back to data, understanding cost drivers and risk factors and then putting the information into the context of employee needs and wants.
“Once you know what the strategy is . . . you can figure out how to leverage some of those new vendors and that new technology in terms of making your workplace wellness strategy really sing,” he said.