When consumers buy less coverage, the cost of that coverage is supposed to go down. But that’s not what’s happened in recent years. Deductibles and out-of-pocket costs are higher than ever before, and so are monthly premiums—for millions of Americans, the new ACA plans really aren’t all that affordable.
For agents, when premiums go up, you’d expect to commissions to go up as well, but that’s not the case. First-year commissions on individual plans were slashed back in 2011; many carriers have cut renewal commissions even further; and some carriers have stopped paying commissions altogether.
While there’s nothing we can do about the recent commission adjustments, we do have an idea that’s worth considering: supplement your income while enhancing your clients’ health coverage. The truth is that both are hurting right now: consumers aren’t happy with their health insurance options, and brokers aren’t terribly excited about selling these plans to them. But supplemental products like hospital indemnity plans, accident and critical illness insurance, and cancer policies can help fill some of the gaps of their primary health coverage while paying a nice commission to the agents who sell them.
In order to help their clients, brokers need to get creative. It’s not as simple as shopping the market, presenting the quotes, and talking to our clients about deductibles and copays. In 2016, getting a quote is the easy part, but most clients are finding that the plans they can afford provide less out-of-pocket protection than in the past. Where a broker can really add value is not necessarily by selling a more comprehensive health plan; but rather by selling other products paired with the primary health insurance, to offer more coverage to help with the out-of-pocket exposure.
Those other products could be tax-advantaged accounts like HSAs and even non-insurance services like telemedicine, but supplemental insurance products are somewhat unique in their ability to help reduce the out-of-pocket cost to our clients while paying a handsome monthly commission to the broker.
To learn more about how to sell supplemental products and see how much money you could be making while solving your clients’ problems, contact AHCP today.