The Association Myth

[Crabcake Johnny]

Don't mix up "can" with "does." GR, Assurant and others don't abuse their rate increases

But what about Mega? I sold a Signature plan - client got hit with 60%. I called my ex-manager (I had quit by then) and he said that for Signature that's about right. 60%?

Also, in the past before United gobbled them up GR was reknown in several states for slamming huge rate increases on their block of busines. United stopped that practice. This was really back in the day but you can see:

http://www.highbeam.com/doc/1G1-7538179.html

so you see how it used to be. Again, these states have been burned in the past.

 

[somarco]

John, I have been in this business for over 30 years and have pretty much seen it all. I don't think there is much that has escaped me, or that I have forgotten despite amazing my friend for having stayed sober, married and out of jail for most of my 56 years.

I have seen what carriers have done to shoot themselves in the foot. None are immune. Here in GA about 6 years ago your pet carrier sent out new rates & lesser benefits to be effective on 12/1.

Only problem was, the communication was only to the IMO's and sent out 2 days before Thanksgiving. Any application dated after 11/30 had to use the new rate structure and new (reduced) benefits.

That same carrier has been guilty of hammering folks on renewal just like Humana, CGI, World, AMS, GR and of course Blue.

I can honestly say there are no perfect carriers out there. All have been guilty of some really stupid stuff over the years. In one of the blogs where I am a co-author I will occasionally post under the topic of "stupid carrier tricks". I have skewered just about every carrier, sometimes by name, at one time or another.

Year in, year out, some do a better job than others, but all have their flaws.

But even more than stupid carrier tricks, are some of the completely idiotic things agents say & do. It will never happen, but I would like to see states do something like with drivers licenses. Every new agent must get a temporary license for a minimum of 12 months and must be mentored by an experienced agent. This wont completely eliminate stupid agent tricks and thievery, but will go a long way towards separating the chaff from the wheat.

 

[Crabcake Johnny]

What a great post. I can't believe an agent can get a license on Tuesday after a 2 day course and sell insurance the next week with zero training.

I also agree that every carrier has played in the gray area before. These are publically held companies and their ultimate responsibily is to the shareholders. I guess you can say that if a company is not financially stable all policy holders are harmed as a result.

If any new agent wants to see just how much bullcrap ALL health companies try to get away with then take a look at the market conduct reports.

 

[J.R.]

What a great post. I can't believe an agent can get a license on Tuesday after a 2 day course and sell insurance the next week with zero training.

I also agree that every carrier has played in the gray area before. These are publically held companies and their ultimate responsibily is to the shareholders. I guess you can say that if a company is not financially stable all policy holders are harmed as a result.

If any new agent wants to see just how much bullcrap ALL health companies try to get away with then take a look at the market conduct reports.

Where can you get access to that type of information?

 

[somarco]

http://bullcrap.com

 

[Crabcake Johnny]

For Md - here:

http://www.mdinsurance.state.md.us/...me=/jsp/availPubInfo/MarketConductExams.jsp10

 

[J.R.]

Good stuff...thanks.

 

[arnguy]

Somarco, I have never seen a health policy that staes "You cannot be cancelled for any reason or singled out for a rate increase." I have seen it worded "You cannot be cancelled for any reason other than nonpayment of premiums...." All insurance applications in PA must have a "Fraud Warning" printed above the applicants signature. This is mandated by the state. Therefore, an applicant should not be suprised if his/her coverage is rescinded and the premium returned for mistatements.

In this part of PA (5-county Philadelphia area), BX does sell commercial HMO and PPO plans through a few select associations. This allows even one-person sole propietors to obtain the same coverage as larger groups w/o underwriting. This is specifically extended to certain occupations including insurance agents, real estate agents, funeral directors, etc.

That being said, BX is going to make an Individual HMO that is fully underwritten available to the public beginning in April with a May 1st start date. This is to compete with Aetna that has been selling a similar product to individuals for the past two years.

 

[arnguy]

You can go into www.naic.org the website of the National Association of Insurance Commisioners and pull up information for every state and the insurers licensed in that particular state. It lists closed complaints by type and the disposition, license info, and financials. If you inquire about a particular insurance comapany at the PA DOI site, you are automatically redirected to the NAIC site.

 

[Crabcake Johnny]

Associated-based carriers do not need prior rate increase approval, can close out blocks of business, and pool unhealthy blocks of business and slam it with a rate increase. The state can't do a damned thing about it.

Carriers filed in that state need prior approval for rates increases. Aetna's increases for MD and AV were pending for three months before DOI approval.

In the past associate-based carriers have greatly abused this. The entire point of association-based policies is those policies cannot be "double regulated."

The language is very ambiguous and even the states don't know exactly how much they can regulate the association carriers. On one had you have states that say Mega can do what they want, on the other hand you have Washington putting a cease and desist on Mega a few years ago for issuing non-complaint plans.

The bottom line is Assurant and Golden Rule CAN rate increase MD policies 75% next year if they want. Aetna and Blue Cross would have to run that past the DOI first.