“They're funny things, accidents. You never have them tillyou're having them.”

Eeyore's advice notwithstanding, even experienced brokers candisagree about accident insurance.

One of the most debated topics in the benefitsbusiness—specifically in the worksite market—is the overall valueof accident insurance for the consumer.

There's little doubt the overall popularity of accidentinsurance. It's a staple in a broker's worksite portfolio andemployees—mostly male—still continue to buy it. That said, thereare still a sizable minority of brokers and other insuranceprofessionals who believe quite strongly that accident insurance isovervalued, over-used and remains a policy often misrepresented toemployees.

Most brokers, though, still recognize the value of accidentinsurance and use it frequently. In reality, and pretty much likeany other insurance product, the value of an accident plan is basedon the situation for the group and the employee.

When discussing accident insurance, most brokers mention theimportance of disability plans first. The accident detractors oftenpoint to confusion between a DI policy and an accident in someminds, and the fact that when offered side by side, sometimes theconsumer will unwisely select the coverage of an accident plan whenthe disability plan is a much better value. The supporters ofaccident point out the cost savings when an employee cannot afforda disability plan and that having a strong accident plan,especially one with a sickness rider, can bring at least someprotection for an employee.

“Granted” they say, “all things being equal a DI policy is best,but for the lower paid worker an accident plan is better than beingtotally unprotected.”

Of course, that is part of the problem to the anti-accidentcrowd. They believe that by representing this to an employee one ismisrepresenting exactly what the policy does and what anindemnity-based accident policy is designed to do, which is pay afixed amount for a specific occurrence. The pro-accident coveragecrowd counters that any policy conflation is the fault of theenroller or the broker and that when explained properly it stillbrings a valuable insurance product to employees that otherwisewould be left at the mercy of an accident or, in some cases,sickness.

Even if it's explained properly though, is there really anyvalue to an accident insurance policy? The brokers who don't likeaccident plans unsurprisingly say no. Their belief is that having amenu that pays “x” amount for a broken finger and “y” amount for abroken leg is absurd and opens the insurance carrier up to aridiculous amount of claims. Again the promoters of accident planspoint out that all accident plans are not created equally. Some paylump sums, some are designed differently all together, some have avery valuable sports rider and that the accident haters are lookingat an antiquated plan and even then can't put themselves in theshoes of the ten dollar an hour oil change mechanic whoselivelihood and the ability to feed their family relies on him notbreaking an arm or at least having something there to help.

They also point out that for those who pay a little more, theaccident coverage can help take the sting out of the cost ofmedical bills. Getting “x” amount for a broken finger sure can helppay for deductibles or other cost, after all that is partially whyaccident insurance was designed in the first place.

Another salient point that arises in the accident discussion iswhen to offer it in a worksite cycle. Every broker agrees that lifeinsurance and disability insurance are the primary needs for allgroups, assuming they can afford disability.

It's also common knowledge that offering more than two or threeworksite products at a time almost always leads to a poorenrollment for all of them. Some believe accident is a definitefirst-year plan to be offered alongside life insurance ordisability. Others though argued it's more of a second-year productto be offered upon re-enrollment. Obviously, that belief hinged onthe total benefits package and other products included.

In the final analysis, even the accident detractors begrudginglyconcede a value in the right accident plan, explained the rightway, under the right circumstances. It could be a plan with asickness rider or without, covering accident on the job, (or morecommonly off the job), a plan with the sports package (or without)as long as it met the right criteria they saw the value.

 The anti and pro accident insurance professionals doagree with each other on one other important facet. Whatever plan,with whatever company, had to have claims paid according to one“justly and quickly.” Nothing can ruin a group for a broker fasterthan unpaid—or slowly paid—accident claims. This is usually thefirst policy in a group that will post a claim, and probably willhave more claims than any other single product. A slow responsefrom a carrier will quickly get noticed by the entire group. Thatcan hurt a broker's relationship with their client and directlyaffect re-enrollment and retention.