Choosing Insurance Carriers in the Individual & Group Markets
Confidence makes sales and product knowledge keep clients. When first meeting with your client, describe your history in the insurance field and why the support Blue Star Benefits offers will make you more than just another broker. We’re always here to support you, but below is a little tutorial to help you be more knowledgeable when it comes to choosing Insurance Carriers.
A premium is the monthly cost of insuring one’s health. Best new business rates are based on age and gender but these rates may be increased based upon the submission of health statements disclosed on an applicant’s application.
The Lifetime Maximum Benefit on all health insurance plans is unlimited as of September 23, 2010 per Health Care Reform.
Co-pays are the amount an insured individual must pay toward the cost of a particular benefit. Typically a fixed dollar amount.
A deductible allows for an individual to absorb the initial risk of adverse health by covering the cost of items up to a certain point.
Co-insurance allows for costs after the deductible is met to be shared between the insurance company and the insured up until the maximum out-of-pocket is reached.
A maximum out-of-pocket (stop loss) clause ensures that in the event of a large medical expense an individual can plan on a fixed exposure, aiding in the process of general budgeting.
Here is an example of how deductible, coinsurance and out-of-pocket come into play in the event of a claim:
Example: david’s PPO coverage has a $500 deductible. Once his deductible is met, David then pays 20% co-insurance until he reaches his $2,000 stop loss. Unfortuantely, David needs surgery…
Full Billed Amount
$30,000
Managed Care Agreed Fee for Service
$18,000
Insurance Company pays 80% co-insurance
$14,000
Deductible
$500
David’s 20% co-insurance
$2,000*
David’s total responsibility
$30,000
*If the stop loss had been higher, David’s co-insurance could have been $3,500.
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