Group benefits executives discuss key industry trends for 2023

During an advisor webinar, Canadian Life and Health Insurance Association (CLHIA) president and CEO Stephen Frank and The Empire Life Insurance Company president and CEO Mark Sylvia identified several key industry trends that could define 2023. These include continued mental health support, increased need for access to health care services, customer experience improvements that are driven by technology, and a greater need for advice-based selling.

Greater emphasis on mental health care

Although discussions on the greater need for mental health care began long before the pandemic, the issue blew up after COVID-19 lockdowns and restrictions began to weigh heavily on people’s minds. Frank believes that mental health will continue to be a topic of interest this 2023.

“In 2021, the insurance industry paid out $580 million in mental health claims, up 75% since 2019,” said Frank. “The pandemic was a challenging period for all of us, but employers stepped up to provide increasing support for their employees. We anticipate that we’re going to continue to see that kind of growth thanks to less mental health stigma in society and greater support in place.”

Improving access to medical services

Sylvia discussed how the insurance industry is helping employees access medical services, and how that trend will continue this year.

“Some companies have now introduced telemedicine services, a valuable option for people who are struggling to access a primary care physician,” said Sylvia. “Access to mental health services has improved dramatically with product enhancements during the pandemic. Looking to the future, this may evolve into insurers having to start thinking about creating concierge or navigation services to support employees accessing their benefits and health care.”

But while demand for access to diagnostic services is increasing, they need to be delivered within the parameters of the Canada Health Act, which both Sylvia and Frank agreed on.

“A new path has opened up in this space,” said Frank. “The crisis in health care is an opportunity for us to do better for Canadians, to do better for patients.”

The increasing importance of proactive client contact

Sylvia noted that for 2023, there is a greater need for proactive client communication and advice to best adjust benefits plans to employer and employee needs.

“Giving the client options is really important. And as an industry, we need to do more to create different options for advisors and their clients. We still have a lot of complexity in our business, so we have to simplify that initial decision-making process for clients and provide more flexible package solutions,” said the chief executive.

Economic challenges remain…

But not every trend is an upside. Frank pointed out that increased costs and a potential recession on the horizon have already impacted benefits costs in 2023, particularly when it comes to dental fees.

“We’ve done a couple of things at the industry level such as reaching out to the dental association and all the provinces to engage them in dialogue to continue to support benefits in the dental space,” said Frank.

… but Canada’s group benefits market will thrive

Despite the looming economic problems, the two leaders believe the group benefits industry will grow this year.

“We paid out $30.4 billion in health, drug and dental care claims in 2021, up 14% over 2020,” said Frank. “Even in the heart of the pandemic when everything had ground to a halt, our business was meeting our promises at a level never seen before in history. This shows the resilience and strength of the industry and the important role we play for so many.”

The trends discussed by Frank and Sylvia echo those identified by other group benefits leaders interviewed by Insurance Business in December. That interview saw Hub International employee benefits chief sales and innovation officer Faizal Mitha saying that he anticipates mental health playing a bigger role this 2023, and Medavie Blue Cross senior vice president of insurance business David Adams foreseeing the further digitalization of health care this year.

What are your thoughts about the Canadian group benefits industry coming into 2023? Let us know in the comments below.