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Minnesota is basically it's own little world when it comes to health insurance, we bascially have five carriers:
BC/BS of MN (about 80% of the IFP market)
Medica (UHC's arm, they do all the administration)
Health Partners
Preferred One (not nearly as much of a player as the Big 3)
Assurant (more or less a non player)
The only carrier I'm aware of changing commission in 2011 is Assurant. I was curious if MN has a mandated loss ratio, and they do (and have had it for a while):
That got me thinking, what loss ratio does BC/BS have currently, I was suprised at the results:
2009
Incurred Claime = 90.2%
Admin Expenses = 7.6%
Broker Fees, Assessments, & Surcharges = 1.8%
I calculated the incurred claims percentage back to 2005 and for all years, the loss ratio was right around 90%. That got me thinking, how big of deal is the MLR ruling? Plenty of health insurance brokers make a very good living in my state, how important is MLR? It seems to me the exchanges are the real threat, not MLR.
The real differences here:
1. No advances.
2. With most carriers, it's a flat fee per app:
$400 per family (2 or more people)
$180 single
$19 PEPM for small group (under 50 EE's)
That may seem low to the rest of you, but like I said, plenty of agents make a good living selling health insurance in my state.
The exchanges are the threat, not MLR if you have a long term focus on this business!
BC/BS of MN (about 80% of the IFP market)
Medica (UHC's arm, they do all the administration)
Health Partners
Preferred One (not nearly as much of a player as the Big 3)
Assurant (more or less a non player)
The only carrier I'm aware of changing commission in 2011 is Assurant. I was curious if MN has a mandated loss ratio, and they do (and have had it for a while):
Small Group - 82%
Individual - 72%
*Loss Ratio defined as incurred claims / total premiums (broker commissions not included)
That got me thinking, what loss ratio does BC/BS have currently, I was suprised at the results:
2009
Incurred Claime = 90.2%
Admin Expenses = 7.6%
Broker Fees, Assessments, & Surcharges = 1.8%
I calculated the incurred claims percentage back to 2005 and for all years, the loss ratio was right around 90%. That got me thinking, how big of deal is the MLR ruling? Plenty of health insurance brokers make a very good living in my state, how important is MLR? It seems to me the exchanges are the real threat, not MLR.
The real differences here:
1. No advances.
2. With most carriers, it's a flat fee per app:
$400 per family (2 or more people)
$180 single
$19 PEPM for small group (under 50 EE's)
That may seem low to the rest of you, but like I said, plenty of agents make a good living selling health insurance in my state.
The exchanges are the threat, not MLR if you have a long term focus on this business!