Anthem

[somarco]

Anthem has been flexing their muscle in GA ever since the merger with Wellpoint. One area is their commitment to run off brokers. Now it seems they are actually going to carry out their threat to terminate 80% of the 5,000+ brokers who write business. They have imposed quota's on the brokers. Produce 10 new lives during calendar year 2007 or face termination.

I understand they have done similar things in other states, terminating agents and generally running off brokers.

What experience have you had when Anthem pulls this kind of stunt?

 

[Bob_The_Insurance_Guy]

Ah, #1, you got the letter the same day I did.

I spoke to several agents who no longer sell through the Evil Empire, and they all said it has not negatively impacted their sales.

I've got until Dec. 17th.

Bye Bye Big Blue.

 

[CHUMPS FROM OXFORD]

Haven't heard anything like that in Ohio...yet.

 

[newmindfashion]

In CT, I'm not aware of this requirement. However, in my state,
Anthem is vital to the independent broker so needing 10 new lives per year wouldn't be an issue for anyone who is active in individual and/or group health.

I'm close to 100 individual cases for the year with them. The other CT guys on this board (Alston, CTInsuranceGuy) would probably agree that they are an important player in our market for individual and group.

I do not agree that they should have a cap for you guys down there or anywhere else. It won't be an issue up here if they try and do that.

 

[TXINSURANCE]

Most major carriers are waking up to the fact that agents doing 1-10 cases per year are likely COSTING them more money then they are pulling in. Think about:

-licensing
-compliance
-appointments
-broker support (training)
-brokers using old quotes / old forms

The list goes on and on - but BCBS of TX will be doing the same thing very soon, I can't say I blame them really. There is a cost associated with maintaining a roster of non producers.

10/year is very nominal, however I think 5 is a better magic number for the masses including P&C agents who sell a health from time to time.

 

[somarco]

For a long time carriers have known that 20% of their brokers produce 80% of their business.

Other than the renewal appointment fees, there really is no cost to the carrier and in most cases the appointment fees are nominal.

Last time I checked I was an independent contractor. Not an employee. Quota's for IC's are ridiculous. Even more so when they do not have a competitive product, underwriting is atrocious and takes at least a month on a clean app. They want to APS anyone who has seen a doc in the last 12 months.

Other than small group, they really don't have anything to offer me. I only write their Tonik business to keep the lights on.

Of course by eliminating 80% of their brokers they will lose 20% in production. Old blocks that can be moved will leaving them with the dogs that generate more in claims than they collect in premium. Brokers that are left will be wondering when the next cut comes and at what production level.

Basically they are shooting themselves in the foot with this kind of action but no one ever accused carriers of being smart.

What annoys me as much as anything is, I have written 13 new lives this year yet they send me a warning letter.

I got along without them before and guess I will now. Looks like my virgin groups will have to go with them for 6 months before a real carrier is willing to take them on.

Ed, you said they had not made any noise in OH. Could have sworn a buddy in OH told me they cut commissions a few years ago in an attempt to run brokers off. I know they did in TN but I don't think that is an Anthem affiliate.

 

[CHUMPS FROM OXFORD]

Bob

Yes, a few years ago they did make some changes. They reduced the first year commission to 12%. However, if you have 50 active health policies on the books, you receive a 6% quarterly bonus on first-year business, effectively giving you 18% first-year compensation.

 

[TXINSURANCE]

They reduced the first year commission to 12%. However, if you have 50 active health policies on the books, you receive a 6% quarterly bonus on first-year business, effectively giving you 18% first-year compensation.

Have they stopped hammering their blocks of business on renewal? I know for a while their increases were pretty rough...

 

[CHUMPS FROM OXFORD]

I just got the Dec renewal numbers. Right around 10%. But until about six months ago, increases were much larger.

 

[TXINSURANCE]

I just got the Dec renewal numbers. Right around 10%. But until about six months ago, increases were much larger.

Thats about average (or better).

I just received an email you can now do SAME SEX DOMESTIC PARTNERS on the Anthem Ohio application. I wonder if Ohio passed some law?