What to look out for when comparing proposals
Every so often, an employer gets approached by a new employee benefits plan broker promising to “save money” or “get better quotes.” It sounds harmless – what’s the risk in seeing what’s available? Why wouldn’t you take the opportunity to see what else is out there, especially in tough economic times like we’re seeing now?
And, of course, there’s due diligence: every few years, as needed, you want to assure yourself that you have a handle on the market for benefits and that you have it under control.
Nothing wrong with that in principle – we make cold calls on prospective client all the time ourselves. But not all cold calls are created equal. I am quite frequently asked by clients to review cold-call quotes and proposals from competitors that promise lower cost.
The first thing I do is ask the client and go over the proposal in detail. There are a number of things to watch out for – red flags, if you will.
Access to “better” carriers: A common misconception is that a new broker can access new or better carriers or rates than you’re getting now.
Actually, of course, most experienced consultants already have access to every major insurer. In fact, established firms like ours often have preferred relationships or blocks of business with certain carriers.
That means we can often secure better pricing and terms than a new or smaller brokerage, thanks to our track record, credibility, and volume. Insurers trust advisors who consistently deliver well-managed, low-risk clients – and they reflect that trust in their underwriting.
So, when we go to market for you, we’re not starting cold. We’re leveraging years of performance history, existing partnerships, and professional respect to get your organization the best possible outcome.
Across-the-board percentage savings: When a cold-calling broker claims they can “save you 20 to 30 percent,” it’s natural to be curious. But it’s also important to ask how those savings are achieved.
The first thing we have to do is make sure that we are comparing apples to apples.
Too often, elements of a plan can cost less because they are reducing coverage, cutting maximums, or removing valuable benefits. On paper, the premium looks lower – but the plan design is weaker. The short-term “win” is quickly erased by higher claims, unhappy employees, and bigger increases when you go to renew later on.
Your consultant’s job isn’t just to find a cheaper plan; it’s to find the right plan – one that’s sustainable, competitive, and aligned with your people strategy. We can market your plan to the same carriers, analyze the same quotes, and show you genuine savings without compromising your employees’ protection.
Know the story behind the numbers: Let’s face it, quoting is the easy part. Anyone can send your census and claims experience data to insurers and bring back a spreadsheet.
What matters is the story that goes with it – how your company’s claims experience, demographics, and renewal history are presented to the carriers.
Because we’ve worked closely with you, we know that story. We know how to position your group to get fair, accurate pricing that reflects your actual risk – not a quick “snapshot” based on incomplete information.
This understanding allows us to negotiate effectively, identify inconsistencies in quotes, and ensure that you’re comparing apples to apples.
Continuity and advocacy matter: A broker could show up just once – to quote. You need someone who is there all year – to strategize, manage renewals, resolve claim issues, educate employees, and support your HR team.
We act as your advocate with insurers, not just your middleman. We have a level of trust and loyalty that flows both ways – to and from our carriers.
That continuity means every marketing exercise, renewal negotiation, and plan design decision builds on a foundation of real knowledge and understanding.
Due diligence – checking up on your plan: The logic of cold calling does cut both ways. When I make a cold call, I don’t go in with a promise to “save 20 or 30 percent” on their coverage. What I go looking for is whether or not their current plan meets some of the basic requirements of a good, long-term, sustainable relationship.
I’ll ask a number of questions at the outset – and I’ll listen very carefully to what the client is telling me.
Does the prospective client’s current plan proactively review the market and optimize plan design?
Do they miss any opportunities for sustainable cost savings that we are able to provide?
Do they leverage carrier relationships and volume discounts to secure not only the best available rates, but also the fast and reliable service?
Do they provide ongoing personal support, education, and advocacy for the client?
When we see a plan that could be stronger, more cost-effective, or better structured for the employees it covers, we reach out to help employers explore options.
When I prepare a quote for a prospective new client, whether we’ve been called in or been referred by one of our existing clients, or whether it’s a true cold call, I always follow the same basic principles.
Fact-based assessment: We look at the plan, claims, and market options carefully. The goal isn’t just to lower premiums – it’s to ensure coverage is appropriate, sustainable, and aligned with organizational goals.
Transparent comparison: If a client’s current broker isn’t maximizing carrier relationships or negotiating leverage, we can show how different strategies, plan designs, or market access could create real value.
Collaborative, not disruptive: We respect existing relationships. We’re not here to “poach” clients blindly. Our goal is to provide insight so an employer can make an informed decision, whether that means enhancing their current plan or considering a new approach.
Employee benefits are a critical part of attracting and retaining talent, controlling costs, and protecting your work force. If a plan is underperforming – whether through cost inefficiencies, limited coverage, or poor communication – employees and employers alike pay the price.
Sometimes a “cold call” is anything but. It’s a signal that your plan may deserve a closer look, that better options might exist, and that a proactive consultant can deliver more value.
A strategic, knowledgeable broker can make a significant difference. That’s why we sometimes reach out – it’s about raising awareness and offering expertise, not simply chasing a new client.
The decision to explore is always yours, but the right expertise can make a meaningful difference – for your budget and your people.
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I really appreciate comments, ideas, suggestions or just observations about the blog or any other topics in benefits management. I always look forward to hearing from readers. If there’s anything you want to share, please email me at bill@penmorebenefits.com.
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