Issue Age Pricing
- Thread starter VT33
- Start date
A few years ago we had a carrier (30 year track record) selling plan F at a slightly lower premium than competing carriers G plan.
I have always been wary of things like this but I let their time in the Medigap business cloud my judgement. For a year or so I offered their F plan which, due to pricing, was a no brainer presentation. Even when their premium was a few dollars more than other G plans it still looked like a wise choice.
Then things went south when one of their other lines created a drag on reserves and they ended up selling most of their block to other carriers in an attempt to stay afloat.
When the excrement hit the fan I managed to move a few clients to other carriers but several were stuck. I still have a handful of clients who hang on to their plan because even if they were interested in an MA plan they stay with the F because it is less expensive than MA and they don't have to navigate the networks.
And I get about $3/month to service their coverage . . .
I have always been wary of things like this but I let their time in the Medigap business cloud my judgement. For a year or so I offered their F plan which, due to pricing, was a no brainer presentation. Even when their premium was a few dollars more than other G plans it still looked like a wise choice.
Then things went south when one of their other lines created a drag on reserves and they ended up selling most of their block to other carriers in an attempt to stay afloat.
When the excrement hit the fan I managed to move a few clients to other carriers but several were stuck. I still have a handful of clients who hang on to their plan because even if they were interested in an MA plan they stay with the F because it is less expensive than MA and they don't have to navigate the networks.
And I get about $3/month to service their coverage . . .
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I say very little difference.
Claim loss ratio trumps everything. All companies have to use same minimum claim loss ratio. I think it can vary a bit by state. Not sure how that dove tails with NAIC.
If the Ins. Co. gets under this they have to refund or apply rebate. Very seldom happens, but it does. As long as there is consistent Medical Inflation I don't think issue age vs attained age mean much 10-15 years down the line.
The most critical thing to rates is closing a block of business.
Absolutely! It almost always leads to a death spiral and usually starts within 3 years.
- 17,167
Your mistake was selling Plan F at all. Plan G was the much better plan if they wanted to save money and have lower rate increases.
I never saw a plan F that made any mathematical sense. Only used it in GI situations.
- 7,330
Caveat, not an agent.
Perhaps one should not say never.
Admittedly my situation is a bit different because I have an Issue Age KS HDf plan. I would expect its current premium to be quite competitive with current KS attained age premiums for HDg at ages 75-80.
And it provides me with a significant savings over the premium for a regular plan G an agent would recommend to me for purchase.
(The risk being that savings would evaporate if I develop a chronic health condition requiring regular annual medical expenditures up towards the (ever increasing) annual HD limit for these plans.)
- 17,167
A High deductible Plan F is not a regular Plan F. Two completely different things and have completely different rate increase histories.
If you were an agent you would understand that better.
I gave my prospects the option . . . F vs G . . . explained the difference and let them choose. Same thing I have done for years . . . explain, let them choose.
The block would have gone south no matter which plan they picked . . . F, G, N.
- 7,330
That has not been my experience.
When I first needed an (HDF) Medigap plan, I found an agent. The posts here all recommended one should have an agent.
I told the agent what plan I was interested in. He told me he did not sell that carrier's products. He told me what he would sell me.
I was faced with the choice of having an agent recommended to me and coverage I did not necessarily care for, or having the plan of my choice and no agent. I went with the agent. After the first year rate lock period my HDF premium went up every year, just like agents here talk about regular F and G plans. I finally got tired of that, dropped that coverage and agent and went to the HDF plan with the carrier of my choice.
So I don't see the HDF plan premium behavior for most HDF (or HDG) plans being any different than the regular F and G plan premium behavior described by agents on the forum.
The shoes on the other foot now . Plan G is getting all the trash GI now and rate increases much higher than plan N and will be much much higher going forward . Ask the massive Non renewed mapd that went to med supps GI's are a lot of plan G's . God help Plan f's as they've got another influx of sick mapd conversions and no new applicants to have non sick people . I think Plan N is the way to go for the 10 or more yrs looking out for rate increases . I'd love to see 2 65 yr olds from 2015 . One took out G and one took out N with the same carrier and compare prices today .
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