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Life Health > Health Insurance > Medicare Planning

A new era for Medicare supplements

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The June 1 changeover for existing Medicare Supplements means a golden opportunity for advisors to better serve their clients’ needs. Med Supps may not be the most complicated sell, but they’re a great opportunity to provide more service to those who need it.

Remember the old, nearly forgotten signs on a storefront or shop that said, “Sales and Service”? You don’t see many of those anymore. Since Americans have chosen to follow the benefits of purchasing at “big box” stores, they, and the superstores, have all but ignored the “service” portion of the sale. Service then, has become nonexistent.

But wait a moment–is that the case in the insurance industry? Well, we all know it certainly should not be the case, and with such a wide array of insurance products, many producers choose to concentrate on one or two specialties and become experts in those areas. That makes sense. But with just a little bit of effort, you can add another arrow to your quiver–that of Medicare Supplement.

As an insurance producer, and in fact, a senior advisor, you have undoubtedly been asked by your clientele if you have any solution to the morass of Medicare options available today. Your response very likely may have included a phrase such as, “No, I prefer to concentrate on the products we have worked on here, so I don’t fiddle with it.”

Well, you don’t have to “fiddle” with it. Recently one of my friends was included in a company ad announcing that he was among the top three personal producers nationwide in that company’s life and annuity production. He got his start in the insurance industry selling Medicare Supplements. But, as his agency has grown, his personal attention has been directed to the life and annuity side of things. So, he just forgot about Medicare Supplement, right? Wrong.

While he continues to enjoy the 6-to-10-year renewal compensation of his previous personal Med Supp production, he also now has two in-house agents to whom he directs his Medicare “leads.” Not only directs them, but in fact, refers them. In other words, his agents follow him and work their specialty as well as their own Medicare production.

Pretty smart. Share the goodies. Everybody gains, but more importantly, the customer is not expected to go down the street to an unknown source for his or her Medicare needs–whether they be Medicare Supplement, Medicare Advantage or Medicare Part D.

If you are specializing in meeting “senior” needs in only one or two product lines, you are leaving money on the table, but more important, you are ignoring your clients’ Medicare needs, unless you have made an arrangement with a friend or other producers to service those needs. In this day and age, excuses such as “I don’t want to learn new tricks” or “It’s just too complicated” or “Let somebody else do it” just won’t work. Or, at least they shouldn’t.

Why discuss this now? Simply because June 1 of 2010 opened up some new and exciting possibilities in the Medicare Supplement business. Every Medicare Supplement sold after that date is a new product. Medicare Supplements sold previous to the June 1 date are “grandfathered” and guaranteed to remain in force as is. But there will be a large number of people who will want to learn about the changes, and some will be interested in changing plans.

Client changes in plans and producers will come about for several reasons. First, the previous agent may have forgotten about the customer after the sale (whoops, no service here). Ignoring the client, perhaps for years, will dearly cost the previous producer. Second, new rates will be all over the map. Some will be higher, some will be lower, but there are sure to be surprises, which a new producer can assess and address. Third, two brand new plans, Plan M and Plan N, will be introduced. These two plans, of which Plan N seems to be the company favorite, are styled to emulate Medicare Advantage plans, with a variety of deductibles and coinsurances.

Above all, the business of Medicare Supplement is not complicated, nor are the new plans, and if you intend to be a “full service agent,” and do not want to personally “fiddle” with your client’s Medicare needs, create an alliance with a friend, or hire someone and include them in your own agency to follow your business.

As you know, referral is the lifeblood of the insurance industry and between your accounts and a solid, built-in referral system, you essentially service your clients’ Medicare needs and put a smile on everyone’s face–your client’s and, of course, your own. Full service.

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