LaffAgent
Expert
- 68
Never intended a personal attack, only honest advice.
Al -
Don't confuse not getting the answer you are seeking with it being a personal attack. While some posts in this thread may have been a little less than tasteful, most of them are exactly what you asked for, answering whether she's being a good samaritan or a scamster. When people answer this, it's not a personal attack.
We all get caught up in the moment, wanting to do the right thing for the client, helping them out. Problem is, there is a whole other side to this story that has been left out, something I think you're missing.
Why are these people uninsurable? Lots of possible answers, but it really boils down to they didn't think they needed health insurance until they got sick. If they did, they would have had health insurance when they became ill, and would have it today.
Instead, they chose to not pay the premiums, and hope that someone would take them when they need it. I've had people come in to talk about health insurance because they need to go get something treated. I have to tell them to go get that fixed, and then come back.
An insurance company is a business, and as such, it provides a way to transfer risk from the insured to the insurance company, for a fee. Notice this says transfer a risk, not a sure loss.
In setting up a policy for a person or a company, you are allowing them to have piece of mind that an illness will not be as financially devastating to the family.
The insurance company gladly takes on that risk, they really don't mind paying legitimate claims (despite the media hype when something is blown out of proportion). If they did object to paying claims, they would quickly lose their agency force, simply because most agents I know want to take care of their clients, and will do what is in the best interest of the client.
You're not the insurance companies shill. I understand that, I don't know to many agents that are. If the insurance company can't help your client, it's your job to help your client by either telling them this, or by getting their business placed elsewhere. It is not your job to tell the insurance company what type of business they should accept or not accept (admittedly, under small group, they have agreed to accept it).
To reply to your post above, older workers, young workers, any type of workers, can bring value to the business, and fulfill a business need. This is why you hire them. If, on the other hand, your hiring them solely to insure them, then this is not legitimate. I think the disconnect with this point is the problem with this thread. Is there a fine line here? Yes. Is it your job to determine this? Not really, you pretty much take the companies word at it, on why they hired someone. Is your job to even ask why someone was hired? No. Is it your job to promote guaranteed issue for uninsurable individuals? No.
Look at it this way. Your writing a life or health app on someone. Your sitting at their kitchen table, they are sitting there chain smoking. You ask, do you smoke (because you always ask), and on your way to mark the 'yes' box, they say 'no'. Which do you mark? A new agent may be tempted to mark 'no' since they can get lower rates. I go into a lecture about transferring risk and paying the right amount for the risk the insurance company is accepting.
Legally, will you get in trouble for marking no? Probably not, unless it is done to commit fraud. After all, your marking the clients answer, you asked the question. You did your job, right? Of course not. It's not ethical. Client throws you out for not marking the box (or you add a cover letter to the app, to protect yourself, and the app gets denied). Does it matter? No. The policy would have lapsed anyway, after they went to the doctor for that nagging cough.....
Dan
Don't confuse not getting the answer you are seeking with it being a personal attack. While some posts in this thread may have been a little less than tasteful, most of them are exactly what you asked for, answering whether she's being a good samaritan or a scamster. When people answer this, it's not a personal attack.
We all get caught up in the moment, wanting to do the right thing for the client, helping them out. Problem is, there is a whole other side to this story that has been left out, something I think you're missing.
Why are these people uninsurable? Lots of possible answers, but it really boils down to they didn't think they needed health insurance until they got sick. If they did, they would have had health insurance when they became ill, and would have it today.
Instead, they chose to not pay the premiums, and hope that someone would take them when they need it. I've had people come in to talk about health insurance because they need to go get something treated. I have to tell them to go get that fixed, and then come back.
An insurance company is a business, and as such, it provides a way to transfer risk from the insured to the insurance company, for a fee. Notice this says transfer a risk, not a sure loss.
In setting up a policy for a person or a company, you are allowing them to have piece of mind that an illness will not be as financially devastating to the family.
The insurance company gladly takes on that risk, they really don't mind paying legitimate claims (despite the media hype when something is blown out of proportion). If they did object to paying claims, they would quickly lose their agency force, simply because most agents I know want to take care of their clients, and will do what is in the best interest of the client.
You're not the insurance companies shill. I understand that, I don't know to many agents that are. If the insurance company can't help your client, it's your job to help your client by either telling them this, or by getting their business placed elsewhere. It is not your job to tell the insurance company what type of business they should accept or not accept (admittedly, under small group, they have agreed to accept it).
To reply to your post above, older workers, young workers, any type of workers, can bring value to the business, and fulfill a business need. This is why you hire them. If, on the other hand, your hiring them solely to insure them, then this is not legitimate. I think the disconnect with this point is the problem with this thread. Is there a fine line here? Yes. Is it your job to determine this? Not really, you pretty much take the companies word at it, on why they hired someone. Is your job to even ask why someone was hired? No. Is it your job to promote guaranteed issue for uninsurable individuals? No.
Look at it this way. Your writing a life or health app on someone. Your sitting at their kitchen table, they are sitting there chain smoking. You ask, do you smoke (because you always ask), and on your way to mark the 'yes' box, they say 'no'. Which do you mark? A new agent may be tempted to mark 'no' since they can get lower rates. I go into a lecture about transferring risk and paying the right amount for the risk the insurance company is accepting.
Legally, will you get in trouble for marking no? Probably not, unless it is done to commit fraud. After all, your marking the clients answer, you asked the question. You did your job, right? Of course not. It's not ethical. Client throws you out for not marking the box (or you add a cover letter to the app, to protect yourself, and the app gets denied). Does it matter? No. The policy would have lapsed anyway, after they went to the doctor for that nagging cough.....
Dan
- 7,790
Al-
There have been some really incisive responses to your question. Instead of accepting them, you have put yourself on a pedestal (or soapbox) to engage in polemics and defend the lady's scheme. If you feel that what she is doing is honest, legal, and ethical why beat a dead horse----just go ahead and take the risk and do it. In PA they allow one and two person groups in GI/HMO plans, but they must pass the "sniff test," i.e., they must be a legitimate business (Schedule C-Form 1040, UC Report filed with the state, etc.).
There have been some really incisive responses to your question. Instead of accepting them, you have put yourself on a pedestal (or soapbox) to engage in polemics and defend the lady's scheme. If you feel that what she is doing is honest, legal, and ethical why beat a dead horse----just go ahead and take the risk and do it. In PA they allow one and two person groups in GI/HMO plans, but they must pass the "sniff test," i.e., they must be a legitimate business (Schedule C-Form 1040, UC Report filed with the state, etc.).
- 14,808
I could easily do the same here in MD - put help put groups of sick people together and facilitate getting them group coverage. A lot would be at stake. A review of claims could expose the business and the policy could be rescinded. I'm also now wide open for lawsuits when it comes out that I was the one who put the deal together. Obviously I lose my appointments with my carrier and possibly my license.
LaffAgent
Expert
- 68
At some back in this thread I asked whether this was a job or a career. I really think that opinions about ethics are greatly influenced by the answer to that question. Insurance is my career and I value my career. I won't jeopardize my livelihood and I won't jeopardize my license. For this reason, I won't decieve the client but I also won't decieve the insurance company.
We need both parties, and it is our job to put them together. We need to be advocates for both.
- 14,808
Well you really don't have to wonder if anything is right or wrong. Call the carrier and ask. If they see no problem with it then it's fine.
I think that the main issue here is that she is working both sides of the "group". She is creating the company knowing that they only want the health insurance and selling the "group" coverage. If she had an agreement with an MLM consultant to write the group coverage after the company had been established then she has plausible deniability that the company was not started to obtain insurance. By establishing the company for the sole purpose of obtaining group coverage she is clearly in violation of most insurance companies underwriting guidelines. Abuse such as this is why many states have lost thier ability to write association plans.
I think we are forgetting that we sign a contract with our carriers stating that we will abide by the underwriting guidelines the carrier establishes. By violating these guidelines she is violating her contract, whether or not it is ethical.
I think we are forgetting that we sign a contract with our carriers stating that we will abide by the underwriting guidelines the carrier establishes. By violating these guidelines she is violating her contract, whether or not it is ethical.
- 2,370
Very very interesting post.
I have a small business opportunity that you could take part in, and as part of the package, there is the ability to acquire group coverage.
To me, that statement almost crosses the line of making the group for insurance, but does not say that you are taking this business for the sole purpose of insurance.
If that was proposed to some potential clients that you have been working with, what would you tell them?
I have a small business opportunity that you could take part in, and as part of the package, there is the ability to acquire group coverage.
To me, that statement almost crosses the line of making the group for insurance, but does not say that you are taking this business for the sole purpose of insurance.
If that was proposed to some potential clients that you have been working with, what would you tell them?
Consumers have no clue how this game is played. My job is to explain the rules of engagement and show them how to maximize their dollars & benefits.
Had a discussion today with my Aetna rep. I told him Aetna was my "go to" company for tobacco users, folks with 3+ kids and those who dont want or need a rider but wont consider an HMO.
I mentioned that Aetna is being selected against because their pricing is out of whack for the "good" risks. My belief is they are writing more bad business than good.
He was surprised to hear that but agreed with my logic.
Occasionally they will get a good risk from me but more times than not they are not in the hunt with other carriers who also want the good risks.
Guess what my job is?
To show my clients where they need to look to find the plan & carrier that will give them the best offer.
I see nothing wrong with that. It has served me (and my clients) well for many years.
Why does it matter?
My job is to find coverage for as many people as possible that delivers the most value. If it happens to be in a guaranteed issue, small group plan, so what?
I don't make the rules. All I do is show folks how the game is played.
If a carrier doesn't want to buy business then they need to get out of the small group arena. They can just as easily write 10+ or 25+ life groups and avoid the 2 life groups.
The correct answer is, you mark "no" for the client but explain to them there is an agents section where you have to attest that the information on the app is accurate to the best of your knowledge.
If the client let's you go ahead with the "no" box, you tell them you will dispute it in the agents section.
My guess is, one of the following will happen.
a) the client will change their mind and agree to submitting an acccurate app
b) the client will let you know where the door is
c) you really don't need someone who is going to lie
