To Group Producers Who Think Individual Policies Are A Waste Of Time

What are the two biggest reasons why agents prefer selling group plans over individual? Group policies have bigger payouts, and educating individuals on different plans eats time for smaller returns.

That's enough reason for many agents to focus all their energy on selling group, referring away their individual leads or only handling the business when it lands in their lap.

Yet some national trends in the individual market are starting to turn those group-centric heads.

Trend #1: Small businesses can't keep up

The amount of businesses offering health insurance to their employees sank 9% in the last five years, from 69% in 2000 to 60% in 2005. According to the Kaiser Family Foundation, 98% of all businesses that have 200 or more employees offer health insurance - meaning the loss in coverage is coming from nearly all small businesses.

Group coverage is becoming too expensive for small businesses to keep offering it.

Trend #2: Individual coverage is becoming more affordable than group

America's Health Insurance Plans (AHIP) released a study in August that demonstrated individual plans are increasingly cheaper on average than their group counterparts.

AHIP found that in 2004 the annual premium for single coverage averaged $2,268 and the average annual premium for family coverage was $4,424. By comparison, annual premiums for employer-sponsored health plans during 2004 averaged $3,696 for single coverage and $9,948 for family coverage.

Employers are spending more on insurance that is cheaper on the individual market.

Trend #3: Individual Plans Hit Popular Media

With the rising cost of insurance in the national spotlight, conservatives and liberals agree that government needs to change something, fast. The chance policymakers will manage a massive healthcare overhaul anytime soon? It's pretty slim, so some are suggesting frustrated individuals adopt a more immediate solution.

According to author and economist Paul Zane Pilzer, group plans will be mostly eliminated in 20 years. Pilzer's popping up everywhere from Newsweek to CNN, urging consumers and small businesses alike to dump group coverage for money-saving individual plans.

According to Pilzer, those small employers struggling to pay for group insurance should take advantage of new legislation that allows them to fund their worker's individual plans with tax-free dollars. The difference could be almost $3,000 in savings per healthy worker.

And employees could benefit too. They get the same coverage with individual plans as they did before, but their new plans won't be cancelled when they leave the job.

The case is made for small businesses and employees to re-think individual plans.

Embracing the individual insurance shopper

So you may not want to give up on group just yet. But consider these two ways agents are seamlessly fitting individual prospects into their existing sales and marketing strategies - without getting swamped.

1. Automate the education process. Individual prospects do require more hand holding for less return. The solution is a website that gives them instant access to all the information they need to make an educated buying decision, seriously reducing the amount of time you need to spend with each customer.
   
   By having a website that integrates automatic quoting, your carriers' plan information and downloadable applications, your prospects will be able to come to you when they're further down the buying spectrum. A good website lets people do their own research 24 hours a day and apply for policies - without ever needing to talk to you.
   
   
2. Automate the follow up process. Don't think you'd have the time to follow up with all those individuals who've been to your site, learned a lot, even talked to you but just couldn't commit?
   
   An email autoresponder program is the easy answer for turning would-be buyers into sales. Autoresponders allow you to automatically follow up with persistent, scheduled email campaigns. With just a one-time set up you'll be touching your database on a regular basis, letting them take action when they're ready to. By using Norvax' LeadMiner, you'll be able to send out periodic emails that include a fresh insurance quote from your carriers. When your prospects are ready to buy, they'll already have your proposal in their hands.

Advertisement: