November 7, 2013 by Tony Novak
I’ve notice a huge increase in marketing of supplemental insurance meant to fill in the gap left by the new health insurance policies required for 2014. The high deductibles and other out-of-pocket costs not covered by insurance are more than many households could afford. As a result some employers are choosing to let employees go to one of the insurance exchanges for primary coverage and then offering the supplemental insurance as an employer-provided benefit.
The advantages to the employer are: 1) side-stepping the difficulties and controversial issues of Obamacare and the insurance exchanges, 2) be seen as a “white knight” solving the problems of Obamacare, 3) providing the insurance that will be used first and foremost be employees in the majority of circumstances, 4) being exempt from the regulatory restrictions affecting primary coverage under the Affordable Care Act, and 5) avoiding the need to report the coverage on the employee’s W2.
The advertisement clip for one product called Value Med (with the name of the insurer and marketer removed) show the type of approach being made to agents (and ultimately to consumers) to market supplemental insurance.
I expect to cover this issue in more detail and write promotional and write consumer disclosures for these products at FreedomBnefits,net as the details emerge. Right now, most products are still being revised for 2014.