Sales and Underwriting: Oil and Water?


In the last three months you and your teams have pushed extremely hard to generate new business for a January 1 start. Many times, this increased focus on new business creates awareness of potential differences between your sales and underwriting organizations.

Have you heard your sales team describe various members of your underwriting (UW) team by using statements like, “sales prevention” or “deal killers?” In my twenty-five plus years experience in the Professional Employer Organization (PEO) and Insurance space, I’ve heard many similar statements. Can this be avoided? Is it healthy to an organization? How does this have a long-term impact on efficiency, job satisfaction, employee retention and results?

I’ve experienced times where the process from initial prospect to first payroll was very smooth and routine (it’s never seamless). I’ve also experienced where it was a challenge to drive efficiencies between the departments. Over the past ten years, this potential challenge has been exasperated for many companies due to increased due diligence as it relates to master group medical underwriting. As we all know, opportunities that are attractive for medical underwriters may not be acceptable for Workers’ Compensation (WC) underwriters. This phenomenon works the other way as well. Many opportunities may be attractive for WC underwriters and could be viewed unacceptable by medical underwriters.

Therefore, the sales organization is balancing two underwriting processes and departments. How does this add to this potential challenge? Can this add frustration, lack of direction and obstacles to the proverbial sales gauntlet? Some may feel this is simply one of the PEO-centric issues we need to manage. Rest assured, there are ways to minimize potential friction between sales and underwriting and add quality business without the drama! My experience with managing over 85,000 work-site employees, 180 internal field colleagues and the charge to organically grow over 15% year over year, we had to focus on removing all roadblocks to quality growth. We were able to add over 27,000 new work-site employees in one year by holding fast to several basic principals. They are based on people and process. Developing and maintaining a strict regimen as it relates to your people and process is key to driving organization effectiveness and efficiency when it comes to sales and underwriting. This may require developing a new process from scratch or making slight adjustments to what you already have in place. Also, if you are confident the process is the appropriate process and you are still having consistent concerns, we must evaluate our current team members. In some cases it may be a simple development opportunity or we may have hired the right person but placed them in the wrong position.

As with any position, hiring the right people for the position is paramount. We must consider background, experience and personalities early in the process. If you are interviewing a potential addition to your sales organization or underwriting team, vet them out! Many only focus on their past experience and not how they will interact with the various departments and colleagues. If you are interviewing a PEO experienced sales representative and they are looking to transition because their current employers underwriting process has “cost them business”, you may want to dig deeper to understand if they were fighting a broken process or if the challenges were self inflicted. As important as vetting the sales colleague, underwriters must be willing and able to communicate and help others understand why a particular prospect may not be a good risk to add to the PEO’s book of business. I’ve experienced underwriters that would not speak with a potential client and others that would be willing to “jump in” and help with the underwriting process. As you would expect, the underwriter that is willing to speak with a prospect to clarify an item wins the respect of the sales team.

In addition to being cognizant of the personalities and background of the team members, we must also build a process that allows for success. This is where the initial training and on-going colleague development comes into play. Having a well thought out and documented training program for your sales and underwriting team is imperative. This is not a two hour portion of your on-boarding training. This cannot be done via pre-recorded online modules. We cannot consider shortcuts as this is where you are setting expectations and how you expect the process to be followed. This is the beginning of a new career and process to recently hired colleagues. It will stick with them for years to come. If training is done correctly, you will minimize much of the potential frustrations, as everyone should be pushing in the same direction.

As part of your training, consider providing subject matter experts (Sales and UW), detailed explanations on your UW philosophy, process specific examples and copies of accurate submissions. Walking your new recruits through the actual process can help them understand why you are asking for specific information and enables you illustrate how to apply what you’ve shown to the sales and underwriting process. Naturally, we must constantly evaluate our process, procedures and UW philosophy. This is an area we potentially loosen and tighten depending on a variety of reasons. If you’ve followed the same process for ten years, chances are there is room for adjustments and improvement. I hope everyone had a great start to the New Year and best wishes for a successful and prosperous 2015!

About the Author

Troy Reynolds is the Chief Operating officer for Palm Beach based Stonehenge Insurance Solutions, a leading provider of workers compensation insurance to PEO’s, and is a leading authority in managing, motivating, and training high performance PEO sales teams with an emphasis on the identification, selection, conversion, and building of profitable PEO client portfolios.