It’s no secret that buying insurance can be extremely complicated. Here is some information about our agents, and how a licensed health insurance agent can make the entire process easier. Many large organizations are reluctant to hire licensed agents. This is true of ALL major insurance companies. Most the people you speak with on the phone are deemed customer support or billing, they are not licensed insurance agents. Many consumers have never even spoken with a real licensed health insurance agent. If you keep reading you can learn more about what an insurance agent can do for you.
Work With A Health Insurance Agent
A health insurance agent, or sometimes called a health broker, is a sales person who is familiar with many insurance carriers and many polices. The agent is licensed in the states in which the insurance is sold and has to abide by the state department of insurance. The agent also has contracts with the health insurance companies to legally discuss their products.
How does a health insurance agent get paid?
An agent gets paid directly through the carrier, so there is ZERO cost to using a health insurance agent. Most health insurance companies pay the same amount, this builds value in the agent. The agent truly wants to match the client to the best policy.
Can I get a policy for less by going directly through a carrier?
NO. All cost are the same. It is illegal for an insurance policy to be offered at different rates. So if you call Blue Cross Blue Shield and find a PPO for $350 a month. That same exact plan must cost the same rate everywhere. If it was priced differently, it would be insurance fraud. Furthermore, all rates are approved by the state department of insurance. So once the rates are finalized everyone quotes the same rates.
Why do the insurance carriers use agents?
Agents are a way for carriers to efficiently market their products to the consumers. Costs can be controlled by paying agents a set commission. This allows the insurance company to focus on managing their claims and helping its subscribers gain access to in-network rates. Most insurance companies house very few licensed agents. It is not cost effective for them to provide the salary, education, work station, phone lines, and health insurance benefits to employ an agent. The insurance companies save billions of dollar a year by NOT hiring agents.
What does an agent do after I chose a plan?
First the agent can assist you with the application and help make sense of the more difficult questions. An agent is also familiar with Underwriting Guidelines, so an health agent can tell you if a rate increase would be expected or not. Many types of insurance policies are subject to Open Enrollment (OE), Initial Enrollment Period (IEP), Annual Election Period (AEP), or Special Enrollment Periods (SEP). This especially applies to individual health insurance, ACA Plans (Obamacare Plans), Medicare including Medicare Supplement, Medicare Advantage Plans, and Prescription Drug Plans.
Are all agents good?
No. First make sure your agent is Licensed. Simply ask them if they have a license. If you don’t feel comfortable with the agent ask the person you are speaking with for their License number and the agent can show you how to check with the Department of Insurance.
Second, see if your agent works independently with many companies or is exclusive to one insurance company (captive). It’s hard to get an unbiased opinion if the agent only represents one company and is a captive agent. Therefore, shoppers who call the insurance companies directly are most likely to end up overly paying for their policy, or ending up with a policy that is not the best fit.
Buy Insurance From A Well Known Insurance Company
If someone took you to a car lot and offered to buy you any car on the lot, would you even consider getting a car you had never seen or heard of? Probably not. A health insurance policy is the same way. If your agent is only offering one company and you never heard of the carrier, chances are the policy may not be what you are looking for. Why risk your health and money buying ABC & 123 Insurance when you could have a good well known company like Aetna, Anthem Blue Cross Blue Shield, Cigna, Coventry, Humana, Mutual of Omaha or United Healthcare / UnitedHealthOne to name a few.
Make Sure You Can Afford Your Monthly Premium
Sadly, most individual health insurance policies only last about year. A good Medicare policy can last for years or even decades. Some people find a job that offers insurance, but most quit paying there premium. Through years of experience we found that people who buy less expensive policies usually keep them longer. By working with a knowledgeable agent he or she can show you basic coverage that may not cover every office visit at a zero dollar copay, but will still provide preventative care and hospital coverage at affordable rates. Often times people forget why they buy health insurance. It is not so much to pay $30 or $40 for an office visit as it is to protect your assets and to get medial coverage if needed. Imagine getting colon or breast cancer, or having your child come down with Leukemia, and you do not have proper medical coverage. Children have some hope of maybe getting treatment, but many adults will not get proper treatment and find their life span drastically decreasing due to limited access to care.
Never Have A Lapse In Coverage
Any lapse in coverage is bad. This law is different from state to state, but the federal law require you to have credible coverage or you will get a tax penalty.
Only Work With One Agent
After you find an agent you like and trust. Only work with that agent. If that agent represents many carriers he or she can show you all the possible choices of coverage. On some occasions I’ve had clients sign up with a proven popular plan and soon cancel. When I make an inquiry into the cancellation I learn that the replacement policy, sold by another agent, was not thoroughly explained. The client ended up buying something different than what they expected! Sadly, this all could have been prevented by just calling the original agent and asking about the coverage of the other plan in question. Remember, a good agents ultimate goal is to get you a policy that you are happy with and keep for a long time.
I Do Take Medications But I Am Healthy
It is good to be optimistic but by underwriting standards, you will not be approved at preferred status (excluding a few medications such as generic birth control, antibiotics). Do not get mad if you get an increase in premium if you have a diagnosed condition and you take medication for it. Underwriting will mostly effect Long Term Care policies and Life Insurance. You may only take 0.5 mg of blood pressure medication, but by underwriting standards that is not preferred plus status. Remember if you are truly healthy that means your height and wait is good and you are not on ANY medications.
Don’t Be Fooled By An Agent Saying: Join Our Association And You’ll Get A Group Rate
NO. This is a sales pitch. You are only eligible for group insurance if you ARE a full time employee (and your employer offers health coverage) or if you own a company and you HAVE full time employees.
Group Insurance Costs Less
NO. Usually, your employer foots most of the bills on group insurance. Remember group insurance is guaranteed issue, so all those very unhealthy people are guaranteed insurance and they drive up the cost of the coverage. Also, the coverage usually has a great deal of “bells and whistles.” Group coverage usually has better chiropractic, acupuncture, and mental health coverage.
When we run quotes for small businesses (2+ employees) they usually opt out and chose to get individual insurance as it is more affordable, especially with the subsidized plans through the Affordable Care Act.
I Need To Research All The Plans Out There
No. You need to research your agent. If your agent is good he will have already researched the many possibilities and sifted through the garbage. And the agent will have gotten feedback from his or her current clients. If you are looking for some spectacular deal you will not find it in an insurance policy. In my experience the people who really search out the miscellaneous carriers will find some unheard of plan end up not only having wasted their time but also having made a bad purchase.
I Only Need Health Insurance For The Kids
Unless you are in an extraordinary financial bind, this is a very poor idea. A better option would be getting a very high deductible plan that covers the whole family.
Ex: Husband and Wife are in their 40’s and children are 8 and 10. The family could get a $8000 deductible plan with one physical a year for $180 a month or the children can get $500 deductible plan with unlimited office visits and dental for the same price.
Take The Family Coverage! An $8000 deductible may sound high now, but after your first $35,000 chemotherapy treatment, $8000 is a deal. Not only will you get the treatment that you need, but you will not have to cash in your 401K, sell your house and cars, just to try and get medical treatment you need. An $8000 deductible is far better than a half million dollar bypass surgery.