Selling supplemental health insurance to seniors is as rewarding as it is challenging because everyone’s healthcare needs are different. Working with the right insurance brokerage is important so you can leverage years of experience when planning how best to approach selling ancillary insurance products to seniors.
Who can I sell supplemental health insurance to?
Everyone is a client for supplemental health products, especially the growing number of seniors. In 2015, there were an estimated 55 million Medicare beneficiaries, and with almost 10,000 Americans turning 65 every day, that number is expected to rise to 82 million by 2030.
The basics of selling supplemental health insurance to seniors
While the prospect of selling to seniors can be intimidating because of all the regulations involved, the process of selling ancillary insurance products to seniors is fairly simple. All applications and Medicare sales appointments must have a Scope of Appointment (SOA) Form submitted to the carrier before the appointment begins.
Many brokers don’t understand that they could increase their sales prospects and income just by being able to sell supplemental health insurance to seniors, which a signed SOA makes possible. Just be sure to fill out a new SOA if your client asks about products that aren’t documented on the first form. Putting all of the available options on the table for discovery is a great way to introduce the idea of supplemental health insurance to seniors and may be the best route for helping them find their ideal level of coverage.
Which supplemental health insurance plans do seniors usually buy?
Most supplemental plans are for everyone, but selling supplemental health insurance to seniors requires a little more attention to detail. Not all plans are available to them, and some plans become available only after a certain age. These are the top six types of supplemental coverage available to seniors.
- Accident: While these plans only cover accidents, they are a good option for people with high-deductible health plans.
- Critical Illness: The critical illness diagnosis—cancer, for example—will affect 77 percent of us in our lifetimes, and these plans can pay a lump sum directly to the covered person at the time of diagnosis, depending on the carrier. The lump sum amount is determined at the time the coverage is written, and some plans include other benefits, such as daily payouts in specified amounts, depending on the plan.
- Dental and Vision: These options can provide some relief for clients. As two of the more familiar types of supplemental insurance plans, they can be a good place to begin the conversation when selling supplemental insurance to seniors.
- Hospital Indemnity: The risk of hospitalization doubles at age 65. These plans pay cash benefits directly to the covered person once he or she is discharged from the hospital. The cash benefits can also help during the recovery phase to offset expenses such as in-home care, missed time from work, standard costs of living, etc.
- Whole Life Insurance: Typically, the best time for people to buy this for themselves or someone else is in their early years (like grandparents buying it for a newborn). However, some people may not be aware that final expense is also a type of whole life policy. Some policies are available up to age 85, which can help with final expenses related to funerals. With the average funeral costing $10,000, final expenses can be intimidating; a benefit from final expense insurance helps make this stressful time just a little easier for loved ones.
How do I sell supplemental health insurance if many people don’t consider it necessary?
Supplemental health insurance can help protect your clients from medical bankruptcy and economic hardship. Surveys have found that 83 percent of Medicare beneficiaries stated that they had to ask their agent about supplemental, or ancillary, products. There are several reasons the topic of selling ancillary insurance products to your senior clients may come up.
- When their health declines
- When a family member or friend’s health declines and the client sees the need because of the financial burden that person has gone through
- When a healthcare advocate asks them to find out more about an insurance plan
With 42 percent of Americans saying that they live paycheck to paycheck, supplemental health insurance may not seem like it will fit into their budget. In 2016, the average income of senior households was around $39,000, so as a broker you must explain the need and justify the cost—because supplemental products are not always perceived as “medically necessary.”
Explaining the concept of how supplemental plans can help fill in the gaps that traditional health insurance doesn’t cover, and pointing out that many plans offer a cash benefit paid directly to the client, can be strong selling points. Along with lower-premium health plans, supplemental insurance can help provide a robust set of benefits and also help keep costs under control.
How Excelsior Can Help Brokers
Excelsior provides a great selection of companies to choose from when selling ancillary insurance products, which vary by state. We have excellent resources to support you in selling supplemental health insurance to seniors. For coaching in areas that will help you meet your sales goals and grow your business, engage with Excelsior today.
Sources: https://www.census.gov/content/dam/Census/library/publications/2016/demo/p60-257.pdf | https://www.kff.org/medicare/slide/projected-change-in-medicare-enrollment-2000-2050/ | http://www.careerbuilder.com/share/aboutus/pressreleasesdetail.aspx?sd=8%2F15%2F2012&id=pr711&ed=12%2F31%2F2012 | https://www.ssa.gov/policy/docs/chartbooks/income_aged/2014/iac14.pdf | http://www.pensionrights.org/publications/statistic/income-today%E2%80%99s-older-adults | https://www.npr.org/sections/health-shots/2016/09/13/493695824/would-you-like-some-insurance-with-your-insurance