One advantage of providing group benefits is that it gives you access to affluent business owners, who, in turn, may make lucrative individual clients.

“You earn the respect through employee benefits initially,” says Gord Brock, a certified financial planner and co-owner of Markham, Ont.-based InvestInsure Group. “Then you move over to the individuals. It’s just a natural evolution through referrals.”

For Brock, who runs part of his business under the umbrella of Montreal-based Peak Financial Group, the cross-selling opportunity is not a formal business or marketing strategy; it’s just the way he does his business.

“My strategy is to do a comprehensive job for my clients,” says Brock, who manages about 50 group plans, generally with 20 to 50 employees each.

Brock doesn’t usually target individual clients within the plan. Instead, he develops a deeper relationship with the owners and executives of the companies whose plans he manages. As he understands their businesses better, doors open.

Most recently, Brock began developing individual pension plans for the owners of a large service business in the Toronto area. In this case, the business was generating a lot of taxable income for the owners. The owners needed a plan, in addition to their group benefits, that allowed them to keep the income and retain it efficiently for income tax purposes. The owners had never had individual pension plans. “It was a case of ‘Where do we go from here?’” Brock says.

Over time, mining group-plan clientele for individual business is not just a fringe benefit for those who develop a book of group clients. It becomes an integral part of building their businesses efficiently, and protecting clients and their assets from being poached by other advisors.

John Boukouris, an account executive in group sales and services with Desjardins Financial Security Investments Inc. in Calgary, says it makes sense to have your arms around employees as much as possible: “It defends you against potential competitors who are also cross-selling.”

From a cost perspective, it’s also less costly to pursue these clients than to seek out new ones. The strategy increases what Boukouris calls “revenue per participant.”

Also, from a financial perspective, retaining group clients as individual clients can smooth out an advisor’s income flow, because group clients can make contributions through payroll deductions, which creates a predictable income or asset flow for the advisor.

“People don’t stop or change contributions to a retirement plan nearly as much when it’s done through payroll,” Boukouris says.

The process generally begins immediately after an advisor retains a group client. The advisor becomes the contact point for employees who have questions about their group benefits, and that often leads to discussions about individual financial planning.

“Client education should result in consolidation of assets and policies for the advisor,” says Boukouris. “The employees like it, because it simplifies their lives by reducing the amount of paper they receive in the mail, and it improves their understanding and comfort with what they are doing.”

Mark Halpern’s marketing approach has made him synonymous with critical illness insurance, but the owner of Markham-based illnessPROTECTION.com Inc.says more than 50% of his business actually arrives via cross-sales to group-benefits clients.

He stepped away from the group business several years ago, and instead he maintains a relationship with Toronto-based PPI Financial Group Inc., which designs and administers the group plans. Leveraging his name and brand, Halpern is able to work with PPI, share in the commissions and approach clients about critical illness.

“My objective is to start with critical illness as a starting point to talk to individuals,” he says. “It rarely leads to them buying the product — but they open up about a lot of other things.”

Often group plans have maximum long-term disability limits that don’t meet the higher income needs of executives. Halpern identifies opportunities to discuss top-up policies, for example, to meet both personal and business insurance needs.

“It depends on the size of the company,” says Halpern. Smaller companies may actually buy a health or life insurance policy for so-called “key persons.”

For example, he is processing critical illness policies for 20 executives in a Bay Street securities firm with just 75 employees. In the event of an illness, the policy proceeds provide the needed cash infusion of capital to keep the company going and fund the expense of searching for and training a competent replacement. IE