Health carriers vs. sales agents (rant)



the majority of carriers don't pay renewals on the increase in premiums.

I've said it before and will say it again... I've never known a financial indusry sector that as a general rule has such a total distain for their sales agents as does the health insurance sector. I wonder if life and P&C are different.

In CA, the blues, Kaiser, Aetna, seem to go out of their way to find ways to not pay us, but still get our production. The auto industry comes close, but they are no match for the health insurance companies.

And you wonder why young people don't want to enter this industry? When is the last time you saw a young college grad say "I really am looking forward to a career selling insurance," as opposed "I'm going to work for a hedge fund company [or mutual funds, or bonds, or derrivatives, etc.]."

Knowing what I know now, I doubt I'd enter the health insurance sector. The only company that truly values my association with them and can't do enough for me (training, bonuses, trips, etc.) is Colonial (if you are not familiar with Colonial, I like to call it the 'better alternative to Aflac.") The problem is that Colonial is a 'hard sell' after Aflac saturates the market with 'know-knowing' agents who 'poison the well' so to speak. Fortunately, everyone and their dog is getting into the work-sup marketplace and that will help dilute some of the bad markeitng and lack of service done by Aflac agents in this area.

With very few exceptions (perhaps John P and his beloved Assurant which is non-competitive in CA) I bet most of you write for health companies you don't truly 'love' and who can do no wrong?

I met an agent recently who places all her business with a tiny HMO called Western Health Advantage... and she 'loves' them. But I've never sat with a bunch of agents (at a seminar) and heard "tales of virtue" about the companies they represent... at least not like I did when I sold services and hardware in the high-tech sector. (I once sold for a company that would do anything (legal) for customers.... even if they lost a ton of money... they never sent out an unhappy customer. (They sold to a larger company (Intel) and were disbanded.)

I'd like to get a job selling for Nordstroms. Or maybe Apple... someone who really valued their customers and sales reps and who had that as part and parcel of the corporate culture... as opposed to greed and deception.

Health insurance is a good and necessary product, which is why I sell it... but the companies who sell the products could use a little old-fashioned house-cleaning and make-over.

Just my opinion. YMMV.

(Can I ramble on or what? Someone pull the plug on me!!)

I'm sorry to hear things are not going as well as they should. Have you thought about selling in other states?
If you do Med supps, then I strongly suggest looking into a company called Lincoln Heritage (if they are available in Ca.). I have an incredible working relationship with them and have found their support invaluable. I feel as if they are truly "in my corner" as opposed to the same ol' run and grind you described in your post. Good luck Al and sorry to hear things have been going rough lately.

"With very few exceptions (perhaps John P and his beloved Assurant which is non-competitive in CA) I bet most of you write for health companies you don't truly 'love' and who can do no wrong?"

You are right. Most of my health business goes to BC, UHC and Aetna. Assurant, Medical Mutual and Celtic enter the mix as well. I like them all, but don't love any of them.

Thanks a lot Halladay!
I'm sorry to hear things are not going as well as they should. Have you thought about selling in other states?

I don't understand what you are trying to say. Things (sales) are going fine. What I was trying to convey is that this industry is broken, not only with the customer who buys the products, but with those who sell the products.

It would be intereting if every healthcare ins. agent in the country staged a one week sick-out in 'protest' of some of the abusive practices that the carriers have and which limit our income.

Whomever took on this action would probably lose all their appointments, but they would become a hero to everyone who seeks change and who feel that the carriers need a clear understanding as to WHO brings in the bacon. (And it is not the local salaried sales reps who meet with agents and hold seminars with free CE credits.)

I have to place my business with various carriers due to rates and underwriting. Most of my business goes to Assurant because they do value their agents and pay fair commissions. Oh...and the plans rock.

Companies like Blue Cross here in MD will always only get an extremely small portion of my business because they abhor agents. That 1st as-earned check comes 3 to 5 months after I write a deal for a whopping $17.50 per month per policy. There are no published underwriting guidelines either.

For agents to reward companies like that by providing them with any significant amount of business amazes me. If you were an engineer would you take a job at General Electric if they offered you $16,000 a year? If you were a computer programmer would you take a job a Microsoft for $8 an hour? Then why are we allowing some of these comanies to pay next to nothing?

I'm amazed Carefirst in MD gets more than 10 deals a year from any agent. I think if the agent community said "enough" obviously it would change. The icing on the cake is in a lot of cases not only do companies like Blue Cross and Aetna pay low commission, but they also cap medications.

I have no idea what anyone means by competitive or uncompetitive. If the plan I recommend:

A: Fits into my client's budget with a reasonable deductible
B: Is a solid plan
C: Doesn't riders out pre-ex conditions

then I want the company paying me the most commission. When I decide to dedicate my life to charity I'll join Habitat for Humanity.

I'll give you an example of a few days ago:

Client currently paying $2,100 a month - had been on plan for 18 years. I sold him an Assurant HSA and with the ratings his family was $580. I'm pretty sure he was happy going down from $2,100 to $580.

Would Carefirst's HSA have been cheaper? Don't really know. I don't tend to pull up their rates often at $17.50 an app.
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I'd love the interview if all employees for health insurance companies were hired as-earned:

Aetna boss: "Well John your resume looks fantastic, welcome aboard!"

Employee: "That's fine, but we didn't discuss salary too much."

Aetna boss: "Well as I stated, it's $50,000 a year as-earned."

Employee: "What exactly does that mean."

Aetna boss: "Well John you have to understand that we don't know if the work you do will have any lasting postive impact on the company. We have to make sure, so you'll see your first check in about three months."

Employee: ".......I have to wait three months for my first check?"

Aetna boss: "Sure. We have to test you out first. Then, at $50,000 a year that's $4,100 a month, but your first check will only be for around $600."

Employee: "What in the hell are you talking about?"

Aetna boss: "Well it's only $600 the first month, then it'll grow to $800 and $2,000 and eventually $4,000."

Employee: "Have you lost your mind?"

Aetna boss: "Of course we expect all of our employees to have around 6 months of bills in the bank before taking our job."
You need to understand the mindset & complexion of the folks who work in HO. Having been on both sides of the fence, here is what you are up against.

You work on commission. They do not.

The underwriters, folks in premium accounting, CSR's, etc., all get a paycheck just for showing up.

You do not.

Underwriters in particular are charged with keeping as much "bad" business off the books as possible. It is easier to say no than to say yes and run the risk of having to defend yourself when the case blows up.

Underwriters are paid to fill in the bubbles, not to think. If you ever find an underwriter who is capable of thinking outside the box you have a winner. Most have no clue how to underwriter, they enter data and spit out what the manual says. They don't have the time nor the incentive to be creative.

Sales dogs are incompetent people who could never make it in the field. In fact, most started in the field and flunked out after a year or so. They interviewed for a job with a salary, expense account & small bonus and they think they died and went to heaven.

This starts at the regional level and goes all the way to the top. Some of the most incompetent people are in positions of authority. They got there by kissing ass, not because they knew their stuff.

Colonial is a good company. I have known people in the past who worked there and they do a better job than most in dealing with their producers. All the rest in that market, AFLAC, Allstate (especially Allstate), Assurity . . . are just wannabe's. American Public is a little better than most and (last time I checked) had some very good products and were agent friendly.

Back to you . . .

Once you realize you are surrounded by idiots (in HO) and they are not going to change, you can deal with it. If you produce, and then stop producing, eventually someone in HO will realize it and make a phone call. Not saying things will change, but at least they will seek you out like one carrier did with me last week. Wanted to know why my production dropped way off in the first quarter.

So I told them

They may or may not heed my advice. Doesn't matter because I will write business regardless.

The week before I wrote a very long letter to an RSD for Aetna. This guy is a friend of mine and he wanted to know why I wasn't placing more business with them, so I told him. I also gave him information, in writing, to justify my stance.

He passed it on to HO where it will probably be filed away next to the Lost Ark.

That's my story. Take it for what it is worth. Carriers are not going to change as long as they are run by idiots. You are not going to get paid any quicker as long as those who stand between you & your paycheck earn theirs by just showing up.
Tim: "Honey I got a job with United Healthcare!!!"

Wife: "That's fantastic! So how much will you make?"

Tim: "They're giving me $65,000"

Wife: "That's great, we'll really be set. So how does the pay work."

Tim: "We'll I think it's a bit odd. The company said if I want to get a check from them I'd have to wait 2 months. Then it's only a few hundred per month but after 6 or 8 months we'll be able to pay our bills."

Wife: "Honey.....we can't afford that!"

Tim: "I know, that's why I'm excited. They also told me I can actually get paid immediately for the work I do, but this guy named Bill out of Texas just cuts me a check."

Wife: "Bill from Texas, who's that?"

Tim: "I have no idea. Never met him. I assume he'll pay me just fine."