NEWARK, N.J., December 10, 2015 - Traditionally, pension risk transfer transactions have been viewed from a purely financial lens, involving a plan sponsor, its plan and an insurance company. However, a new white paper series released today by Prudential Retirement examines the role of service delivery in a PRT transaction and its impact on the customer satisfaction of plan sponsors and retirees. Prudential Retirement is a business unit of Prudential Financial, Inc. (NYSE: PRU).
According to the white paper series, “The Three Pillars of Exceptional Service Delivery,” PRT service delivery has evolved from standard operational practices (data processing, retiree on-boarding, payment processing, record maintenance) to consultative practices that focus on insurers’ capabilities and retiree communications before, during and after the plan transition.
“Once signed, group annuity contracts are irreversible. This means that a plan sponsor has only one opportunity to get it right when selecting a service provider for their retirees,” says Dave Casto, head of Pension Risk Transfer Service Delivery at Prudential Retirement. “This white paper series calls attention to the importance of insurer selection beyond financial measures and offers criteria for identifying exceptional service delivery capabilities and evaluating their effectiveness over time.”
The series consists of three white papers, each focused on a different pillar of the service delivery experience: 1) retiree communication and education, 2) transaction and transition, and 3) consultation and commitment. The white papers define “exceptional service delivery” as an insurance company’s ability to leverage its:
- Service delivery capabilities—including its ability to create a comprehensive plan that addresses all of the plan sponsor’s and their retirees’ needs.
- Systems capacity—the ability to effectively onboard large populations of retirees and beneficiaries without payment interruption or data being compromised.
- Human resources proficiency—having a transition team in place to guide retirees through every phase of the transaction and an experienced and dedicated customer service team to service retirees during the transition and beyond.
- Commitment to the customer experience—the ability to offer a variety of on-going communication and education touchpoints, so retirees can access the information they want, when they want it and the way they want it.
The series also illustrates the importance of continuous evaluation and improvement of service delivery capabilities and the impact these capabilities have on the satisfaction levels of plan sponsors and retirees. For example, in 2013 when asked about the helpfulness of the transition information Prudential provided, 73 percent said it was very helpful, while 94 percent indicated the same in 2014. When asked about welcome kits they received from Prudential, 79 percent of annuitants said they were helpful in 2013, while just a year later that figure increased to 88 percent.
“Insurers are not only assuming commitments to deliver a dependable stream of income to retirees, they are also promising to offer administrative services beyond issuing monthly payments,” Casto explains. “Companies have recognized that their reputations are on the line if the selected insurer isn't committed to providing retiree services at least as good or better than the retirees enjoyed with the plan sponsor.”
Prudential Retirement delivers retirement plan solutions for public, private, and nonprofit organizations. Services include defined contribution, defined benefit and non-qualified deferred compensation record keeping, administrative services, investment management, comprehensive employee education and communications, and trustee services, as well as a variety of products and strategies, including institutional investment and income products, pension risk transfer solutions and structured settlement services.
With over 85 years of retirement experience, Prudential Retirement helps meet the needs of 4.0 million participants and annuitants. Prudential Retirement has $366.2 billion in retirement account values as of Sept. 30, 2015.
Retirement products and services are provided by Prudential Retirement Insurance and Annuity Company (PRIAC), Hartford, CT, or its affiliates. PRIAC is a Prudential Financial company.
Prudential Financial, Inc. (NYSE:PRU), a financial services leader, has operations in the United States, Asia, Europe, and Latin America.