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Monday, May 6, 2013

10,000 Americans Per Day: Addressing the T-65 Market, Part 2

By Jon Hamilton, Vice President of Strategic Solutions for Insurance Dialogue

In Part One, we discussed why baby boomers are an important market and how the bank-insurance partnerships provided by ABIA member Companies can help seniors get the best Medicare supplement policy available. To understand this, you need to know what is available to them. The choices include:
  • Original Medicare plus a Medicare Supplement (Medigap) Policy
  • Medicare Advantage (also called Medicare Part C)
  • Original Medicare only (not the best choice for most people)
For those who can’t afford a Medigap plan, Part C is an affordable alternative and there are often plans available that have zero premium. These low cost plans require the individual to pay their Part B premium, but there is no additional premium for the Medigap coverage. Part C offers coverage through Medicare-approved private insurance companies. Part C coverage offers the benefits and services covered under Part A and Part B, plus a supplement.

There numerous resources available to learn the details of each Medicare plan, but customers should begin their research on Medicare plans at the U.S. government Medicare website. The government website provides information on the Medicare plan and companies that provide Medigap plans in the senior’s area. This resource can be overwhelming for seniors, which gives licensed agents working on behalf of the bank a great opportunity to simplify the enrollment process.

There are a lot of regulations involved in selling Medicare products and many complexities in dealing with the Center for Medicare and Medicaid Services (CMMS). One way banks manage the rules and complexities is by hiring a company to assist their senior clients on behalf of the bank. Approaching the market this way may cut down on the potential commission but it solves numerous problems.

Choosing a company to partner with is a potential challenge for banks. Some underwriters will contract with a bank’s insurance agency directly. However, a single company may not have products that meet the needs of all applicants. Partnering with a company that offers contracts from multiple carriers – and utilizes a choice process to assist the customer – will offer more variety for bank customers.

Read part 1.