Gap Policies

[somarco]

How much risk does a gap policy cover?

Not much and certainly not worth the premium one pays for this type of plan.

If you have ever looked at loss ratio's on gap plans you will know they generally pay out in the neighborhood of 50% of gross premiums. That is robbery without using a mask and gun.

 

[ABC]

Gap works for a certain type of group

Older employees with very high retention
High claims
Will not change life style
Group feels that rich benefits are a right
Owner feels obligated not to completely cost shift onto the employee.

Your not selling loss ratio

Your selling a strategy to reduce cost and still maintain company morale.

How much risk does a gap policy cover?

Not much and certainly not worth the premium one pays for this type of plan.

If you have ever looked at loss ratio's on gap plans you will know they generally pay out in the neighborhood of 50% of gross premiums. That is robbery without using a mask and gun.

 

[somarco]

You are right, I am not selling loss ratio.

I think gap policies are crap and a rip off and I won't offer them no matter how much money is to be made from taking advantage of suckers.

 

[ABC]

Thats a great attitude to have.

This approach does not work with micro groups you need at least $100,000 premium. The next time you are working a $100,000 deal look that this approach because the next agent might.


The group I put this approach in I had 3 people diagnosed with Cancer. I did the deal GI with no Pre X. All three people are on claim and have been paid. Further more they had most of their deductible paid by Colonial.

You are right, I am not selling loss ratio.

I think gap policies are crap and a rip off and I won't offer them no matter how much money is to be made from taking advantage of suckers.