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NFP executive benefits broker urges consultative approach for fast-growing needs
NFP research cited by Tony Greene says 49.0% of organizations report their executive benefits lack flexibility, as demand shifts toward highly compensated employee groups outside the traditional C-suite.
Benefits brokers who run holistic, consultative discussions with plan sponsors are well positioned for growth in group benefits, according to Tony Greene, President of NFP Executive Benefits, following the release of NFP's latest executive benefits research, reported by Insurance Business.
Greene argued that the market is changing who qualifies as the audience for so-called executive benefits, saying the term is outdated and that the new focus is a growing cohort of employees with total compensation around $175,000 to $225,000, not only top corporate executives.
He pointed to a structural barrier under ERISA, where there is a hard annual cap on what individuals can contribute to a 401(k). Greene said for higher earners the math does not work if the plan relies only on a 401(k), and he described non-qualified deferred compensation plans as an increasingly used alternative because they are outside ERISA contribution limits and allow pre-tax deferrals distributed at a set future date.
NFP’s research, as discussed by Greene, found 49.0% of organizations say their executive benefits fall short on flexibility, and he attributed rising pressure to two workforce shifts: a Baby Boomer retirement wave before the end of 2030 and a smaller Gen X cohort that employers need to retain.