Let’s get straight to the point: Buying insurance is frustrating. Even with all of the technological advancements we’ve made in the past 20 years, the process of getting and managing insurance hasn’t gotten much easier, especially for small to medium-size businesses who don’t get the same service as their larger counterparts.
However, as some industry players make progress on underwriting, pricing and distribution and venture capitalists start backing startups, who are ready to transform and disrupt the insurance industry, we’re starting to see a shift in the way businesses are choosing to buy and manage their insurance.
So, what exactly is the problem?
While the Internet has been an incredibly useful tool for finding information on the product or service we are considering, this has not translated to the insurance industry. There is plenty of information about certain insurance types and policies, but more often than not, the content is missing the mark. To truly understand what coverage they might need for their company, business owners usually have to reach out to brokers or insurers for answers.
Prolonged quoting periods.
Right now, in order to get insurance, business owners must either get in touch with a broker or the insurance provider specifically. Even the process of getting a quote, or pricing information for insurance, can take two to four weeks, and none of it exists online.
Online management of business insurance policies is something that has been slow to adapt to the 21st century. After a company buys an insurance policy, they are sent a 200-plus-page PDF, promising that their business is covered should anything bad happen. The length isn’t really the issue here, rather the limits around the document. Business owners have no easy way to access, search or remember when their policies are up for renewal. This isn’t ideal if you’re a business owner
Business owners are busy.
Business owners have a million and one things to worry about outside of their insurance policies. After jumping through hoops with an insurer or broker to get a quote, in addition to the lack of education and transparency in pricing online, you can almost guarantee that these business owners will buy the first policy they’re offered. It’s not that business owners don’t see the importance of insurance; they simply don’t have the time to really deal with it.
They don’t get what they pay for.
Have a quick question about your policy? Not so fast. Insurance companies are met with some of the worst net promoter scores out there. In turn, business owners get some of the worst customer service and should expect a long wait when dialing in for an answer.
Let’s not forget about the inability for business owners to manage their policies digitally, which means even more time on the phone when a policy is up for renewal. Technology is helping
We know how important insurance is to running a successful business, but it’s clear that some serious changes need to be made. According to CBInsights, investors poured $2.65 billion into insurance startups globally in 2015, compared with only $740 million in 2014. This has a lot to do with the loosening of regulatory laws around insurance, which allows these investors to put their money into insurance technology startups that are hoping to change a broken industry, desperate for innovation.
Companies such as Oscar and MetroMile have already seen great success revolutionizing personal insurance types, but unfortunately the same cannot be said for those looking to buy business insurance, especially when it comes to small to medium-size businesses.
When you’re just starting out as a business or if you’re outgrowing your small-business status and becoming a medium-size business, purchasing and managing the right insurance is a harrowing process, to say the least.
The best way forward is by constantly getting feedback and working hard to improve the options for small and mid-size businesses based on that data. There is an enormous opportunity in this untapped market to use technology, data and design to make the entire process much easier for business owners.
Startups and venture capitalists taking on this challenge means the writing’s on the wall for the insurance industry: Innovate or get left behind.
In today’s world, the customer is all about finding something faster and easier, and if that option exists, trust us, they’ll take it. Bringing insurance online does not necessarily mean a complete reinvention; it just means a warm welcome to the 21st century, and we’re waiting with open arms.
While the debates over Obamacare have faded into the rear view mirror of public discourse, another major crossroads lies ahead as health insurance giant Anthem has unveiled plans to merge with Cigna in a $54 billion deal. Health care industry specialists cannot agree on whether bigger is better when it comes to this pending health care merger.
This month, Denver Post health care reporter David Olinger laid out the debate around the Anthem-Cigna merger. Insurance Commissioners and Attorney Generals across the country are reviewing this merger, along with another merger of Aetna and Humana, according to state laws that govern the consumer protections around health insurance.
While millions more Americans now have insurance, the prospects of everyone getting quality affordable health care—particularly in underserved communities—is are still unclear. Many people underutilize their insurance because the process is too complex. Some stop paying for their insurance plans shortly after they get covered. Colorado’s health exchange recently went through a shutdown of the non-profit health care co-op and the departure of United Health Care from the market.
So amidst all of this complexity, how are we to figure out whether these health insurance mega-mergers going to impact the average person?
Here are five questions that should be answered before the merger is approved or denied by the Colorado Division of Insurance (DOI), which regulates the insurance industry in our state.
1. The merger may be good for Anthem, but is it good for Colorado?
The merger would increase Anthem’s bottom line by billions of dollars. Yes, that is good for Anthem, but it doesn’t benefit Coloradans. For instance, different insurance companies have different approaches to coverage for transgender people. In fact, these two companies differ in how they treat this population—which policy will they adopt?
The Colorado Medical Society has opposed this merger. How will their voice be incorporated into this discussion? Will the health care choices of Coloradans be limited?
2. What does Connect for Health Colorado (the health insurance marketplace) think about this merger?
Colorado Connect for Health is the state’s marketplace for affordable health care, commonly known as “Obamacare.” Its mission, clearly stated on its website, is “to increase access, affordability, and choice for individuals and small employers purchasing health insurance in Colorado.”
The pending merger would cut one more insurer out of the market giving Colorado consumers one less option in selecting a health care provider. Is that a good idea? While the DOI considers this merger, the Colorado Exchange is a crucial voice in this debate. Have they discussed this issue at any of their public board meetings? Anthem has a seat on the board of the exchange.
3. What about rural health care providers and their patients?
Doctors are scarce in some rural communities. These doctors or sole practitioners could be forced out of health care networks, raising health care costs for some communities that continue to face economic challenges. Will rural communities suffer?
4. What will this do to indigent care?
The Colorado Indigent Care Program is funded with federal and state dollars to partially compensate participating providers who provide health care to the uninsured and underinsured.
The question remains: How will Anthem-Cigna merger impact Colorado’s low-income families who are dependent on this program?
5. Should there be a public conversation about this?
Yes. I applaud Division of Insurance Commissioner Marguerite Salazar for pledging to hold a public hearing on the Anthem-Cigna merger. However, the regulations offer a comment period of only 30 days—is that enough time?
Discussions at the hearing must address the important questions raised above. And, we as a community have a responsibility to participate in the public hearing and let the Commissioner know that we care about our health care providers and how they treat us.
Last month I talked about how a company determines what you should pay for auto insurance.
Since that article, the second largest insurer of private passenger autos in the state of Georgia announced it is raising rates an average of 25 percent and up to 50 percent for some customers.
As I explained last month, rates are based on the experience of the company’s customers. How many claims did they have and how much did the company pay to reimburse customers and third parties involved in accidents for their claims? Apparently this company’s experience worsened resulting in a significant shortfall in their monetary reserves set aside to pay existing claims as well as an increase in the trend of new claims.
So if you experience a significant rate increase what should you do?
The first thing would be to contact your agent or company to see if you are getting the proper credits on your policy, and discuss options of lowering the overall cost. That does not include decreasing coverage, unless you want to drop physical damage coverage on a vehicle that is more than 10 years old and not worth carrying comprehensive and collision coverage. That decision is yours based on the condition of your vehicle and the cost to replace it.
Credits would include defensive driver credit, multi-policy discounts and multi-car discounts. Also, check to make sure your vehicles are rated for the proper usage, ie., pleasure, commuting or business use.
If you are not able to bring your premium down significantly with your current carrier then you need to go shopping.
Auto insurance is a very competitive product. There are many companies out there that would be happy to have you. Internet shopping is one way to shop if you know what you are looking for. Direct writers you can call for a quote is another option and can provide you with coverage as of the phone call.
If you do not want to go on the Internet to access several companies, or feel uncomfortable with the coverage you need, you can call a local agent that, as a captive agent represents one company, or as an independent represents many companies. Do not stop with one agent or company. You might find some savings with the first company you call, but there may be more savings available. Get quotes from at least four or five companies to make sure you are getting the best rate for the coverage you need. Do not accept a lower rate for less coverage unless you really feel you do not need certain coverage. Find someone you can trust and be smart. UPNIN Specialist are ready to shop multiple carriers for you and makes sure you get the best price. To learn more visit UPNINInsure.com
As an owner of a small or growing trucking company, you want to provide the best health benefits to your employees and their families. And yet for many companies, traditional employer health insurance has become too expensive or simply does not meet the unique needs of a mobile and diverse workforce. As such, trucking companies nationwide are evaluating health insurance options including individual health insurance reimbursement benefits.
Individual health insurance reimbursement is a cost effective solution - but it is a shift in how we think about health benefits. Instead of the company providing an insurance policy to employees, the employees choose their own insurance and get to keep it even if they switch jobs. As such, it is natural to have questions about how it works for your company and employees.
Q. How does individual health insurance reimbursement work?A. With this health benefits approach, your trucking company sets up a health reimbursement plan to give employees a healthcare allowance. For compliance reasons, and for easy administration, most companies use third-party software to help set up and manage the plan.
Here’s how it generally works.
Q. How much time will it take the company to administer?A. Once implemented, the benefit program should only take 5 minutes per month to administer online. Companies use software to set up the plan, enroll and educate employees, ensure compliance, and add approved reimbursements to payroll.
Q. Is a reimbursement plan considered health insurance?A. No. A reimbursement plan is not health insurance. Rather, the plan is a Self-insured Medical Reimbursement Plans, also called a Healthcare Reimbursement Plan (HRP).
Q. How does it work for employees?A. Employees select and purchase an individual health policy that best fits their families' needs, choosing any plan, from any carrier. Employees may use their healthcare allowance to be reimbursed for eligible premium expenses. They can keep their same network and doctors, and pick a coverage level that fits their health needs. Individual health plans cost, on average, 20-60 percent less than traditional group plans, and federal tax credits may be available to qualifying employees.
Q. Where do employees purchase insurance?A. Employees may purchase insurance through a licensed health insurance agent (who is appointed to represent the insurance carriers), online, or through your state’s Health Insurance Marketplace. Employees are no longer asked medical history information on the application, and cannot be denied or charged more because of a pre-existing condition. Many companies also find it helpful to have a licensed health insurance agent help employees navigate plan choices.
ConclusionAs trucking companies research how to offer affordable, competitive health benefits it is common to evaluate transitioning employees to an individual health insurance reimbursement program. We hope this article has answered your questions about how it works, how employees purchase insurance, and how reimbursement software can make the transition seamless.
Less than half of middle income earners age 25 to 64 own individual life insurance, according to LIMRA, which keeps close tabs on the life insurance industry.In the same survey, 44% of those who didn't have it said they needed it.When considering life insurance, one of the most important factors to understand is the difference between term and permanent insurance. Here’s an inside look at both.
TERM AND PERM
Term life insurance is temporary; it provides a death benefit for a specific term, such as 10, 20, or 30 years. Unlike other types of life insurance, it does not accumulate a cash value. If the policyholder dies during that term, his or her beneficiaries receive the benefit from the policy. When the contract ends, so does the coverage.This limited term leads to term life insurance’s main advantage: price.
Generally, term life insurance costs less than permanent life insurance, especially if the purchaser is younger. This has the potential to free up funds for other household expenses.Permanent insurance remains in place as long as the policyholder makes payments. In addition, permanent policies are designed to build up “cash value,” a cash reserve that accumulates with the policy. Typically, this cash reserve pays a modest rate of return. However, the policyholder has limited access to the funds.
WHICH SHOULD YOU CHOOSE?
Term life insurance can be designed to provide protection against upcoming expenses, such as putting children through college. Permanent life insurance, on the other hand, can be more useful for covering long-term financial needs, such as estate planning.Many people find that they have a combination of short- and long-term needs. In such circumstances, it may be prudent to have both types: a basic level of permanent life insurance supplemented by a term policy.
A review of your situation may help determine what type of life insurance is appropriate.Several factors will affect the cost and availability of life insurance, including age, health and the type and amount of insurance purchased. Life insurance policies have expenses, including mortality and other charges. If a policy is surrendered prematurely, the policyholder also may pay surrender charges and have income tax implications. You should consider determining whether you are insurable before implementing a strategy involving life insurance. Any guarantees associated with a policy are dependent on the ability of the issuing insurance company to continue making claim payments.