Does Anyone Here Know Why Cigna Cut the Agents in NC?

[bill3173]

It's been a while now, and I thought that maybe someone may know something.

One of the carrier reps called me recently to encourage me to sell in Florida, because of the commission and bonus programs. He still wouldn't give any insight as to why they cut the comm here to 2%.

The company line is they wanted to increase direct sales, which is HS, you don't need to cut the agent channel to increase direct sales, and the cost per new member is lower anyway using agents. Any idea?

 

[Yagents]

It's been a while now, and I thought that maybe someone may know something.

One of the carrier reps called me recently to encourage me to sell in Florida, because of the commission and bonus programs. He still wouldn't give any insight as to why they cut the comm here to 2%.

The company line is they wanted to increase direct sales, which is HS, you don't need to cut the agent channel to increase direct sales, and the cost per new member is lower anyway using agents. Any idea?

There was a thread on this matter about a year ago. It had something to do with BCBS having such a large market share, and command of the market, that no matter what cigna did, they couldn't break in. So why pay anyone for no potential

 

[taterpeeler]

i had been told that there was some state they just could not make any money in so this was an effort to "control' sales... cant remember if that was the state or even the company in question but i think it is

 

[Crabcake Johnny]

Blue Cross has a 72% market share in NC. UHC is their closest competitor with 12%. Basically, if you're not selling BX in NC you're not making a living selling health insurance and as stated above, Cigna has a zero chance of even getting a percentage of that market.

In fact, unless things have change, NC residents can't even get appointed with BX anymore. It takes an act of God.

 

[bill3173]

Okay, but the fact remains that they're still selling in NC, just not nearly the same volume. They didn't pull out of the State, they just raised their acquisition cost. They were the most competitive with BX, and there were agents/agencies selling a ton of their junk.

This is one of those things where you'll never get a straight answer. One of the execs may have been turned down by a female agent in NC, and then socked it to everyone.

 

[ABC]

What I know about Cigna is they were really testing the market for Individual and small group sales. They are a large group carrier 500+ lives. My guess is they saw the risk and decided it was not worth the effort in the individual market.
Instead of pulling out all together and risking negative political feedback the just drop comp.

 

[somarco]

Cigna was writing more business direct than through agents, at least that is their story.

 

[taterpeeler]

Cigna was writing more business direct than through agents, at least that is their story.

hahahhaha... thats funny

 

[Guest]

Cigna was writing more business direct than through agents, at least that is their story.

Yeah that's their story and they are sticking with it, ha! Angela

 

[somarco]

Enhanced answer, FWIW . . .

Apparently BX is dominant in NC and has a quota for agents that want to write business with them. As such, agents place as much new business with Blue until they hit their quota and then will shift to other carriers.

Cigna's story is they usually don't get business from brokers who use BX until summer or later, once they have hit their required volume.