Portals, Case Installation Top-of-Mind for Defined Contribution Providers in 2019

Technology strategy investments in the defined contribution space must juggle prioritizing the needs of brokers and consultants, plan sponsors, and plan participants. The market is changing at the same time.

DC providers contend with competition from adjacent markets—e.g., those from asset management firms, banks, and mutual fund providers—not to mention competition from other carriers. More employers are looking for holistic financial planning offerings for their employees as healthcare costs and student loan debt continue to grow. Plan providers also want to satisfy digital user experience needs, comply with regulatory change, and maintain acceptable margins.

DC carriers are enhancing capabilities across the board, including in enrollment, investor education, and compliance. They are making technology investments across the value chain, though a significant portion goes toward the areas of case installation and distribution.

Carriers are focusing on multi-channel employee support and coordinating multiple enrollment methods; many plan sponsors have auto-enrollment capabilities. Carriers are also working to improve client retention and acquisition by driving down operational costs and, at the same time, add new investment choices. Many are implementing new core recordkeeping and transaction processing solutions to address these concerns, as well as to allow them to integrate and deploy capabilities more rapidly with participant portals to support regulatory requirements and self-service.

Portals are a key element in DC carrier technology investments in distribution. Strong plan participant portal capabilities are an area of competitive differentiation and a critical contact point. Carriers are expanding the functionality of sponsor portals to improve insight into in-force plans. Likewise, carriers are building out plan advisor portal features—including mobile capabilities—to help navigate the lengthy DC plan sales and subsequent implementation processes.

Investor education remains a challenge in the DC space. Carriers work to ensuring that plan participant contribution is sufficient for a comfortable retirement, but the addition of new and more complex products can complicate these efforts. Carriers are transforming advisor and participant portals into information hubs that feature articles and video content.

See Novarica’s latest report for more on business and technology trends and challenges in the defined contribution retirement plan space.

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