One big misunderstanding health insurance clients have is the difference between major health insurance and supplemental policies. While there are some similarities, it is of great importance that agents stress to their customers or prospects the differences, so that there will be no confusion about what you are selling them.
If you work for a major health insurance company, such as Blue Cross/Blue Shield, it will be pretty simple to explain. As long as you know what your policies cover, you can just go over the coverage and then answer any questions prospects may have.
But if your company only sells supplemental policies, one of the most important points to stress is the fact that supplemental policies only cover specific illnesses, such as a heart attack, stroke, or cancer. Supplemental policies were meant to fill in the gaps left by major medical, and were not meant to be the only policy a person has.
Some people get confused and think their critical illness plan covers all hospital stays, doctors’ bills, and surgeries, when really all it is intended to cover is a specific illness and the complications that arise from that illness.
Here are a few points to keep in mind in an effort to keep the two types of insurance separate in the minds of clients:
1) Remind them that “major medical” refers to a comprehensive plan which includes doctor visits, tests, medications, and hospital stays and is meant to be a major plan to cover almost any condition. It also may pay up to 80% of costs, while supplemental plans may only pay in specific circumstances, or only pay a set lump sum.
2) Show clients the specific illnesses or benefits covered by supplemental insurance, and remind them these specific plans cover only related illnesses, situations, or conditions. The plan does NOT include tests, procedures, or anything else related to any OTHER illness. These are instead covered by major medical.
3) Advise clients to consider the likelihood of the specific illnesses before deciding whether to invest in a supplemental plan. Remind them that the best scenario is to have a major medical plan for most things that come up, and a supplemental one for specific illnesses that will pick up where their major plan leaves off.
4) Read the exemption clauses and know what illnesses either type of policy will NOT cover.
Finally, remind clients that, while there are some similarities between the major medical health insurance plans and supplemental policies, the best situation is to make sure there is a major plan in place first, then weigh the risks of a particular illness and purchase an additional plan to cover extra expenses.
One of the best aspects of having both major medical and supplemental health is that most supplemental plans will cover the specific illness in addition to what the major medical plan covers. Sometimes the supplemental plan will even pay benefits directly to the customer. Always read and explain the exact coverage to each client and remember that this will vary. But in general, both insurance plans will pay if the illness is covered under the supplemental plan.
Taking the extra time to explain these differences will save a lot of confusion and potential misunderstandings in the long run.