ROLE OF THE HEALTH INSURANCE AGENT
IN THE HEALTH CARE DELIVERY SYSTEM
Role of the Agent
Historically, the agent system has been the primary method of distribution for private health insurance. Agents are the essential link between the consumer and the insurance company, providing personal service in the selection of insurance coverage that meets the clients’ needs.
Dramatic increases in health care costs in the last decade have made the agent an increasingly important part of the health care equation. More than ever, individuals and businesses rely on the advice of their agents regarding cost savings measures and coverage options.
Insurance agents, like elected officials, are held accountable to their constituents. Agents must assure that the clients’ needs are appropriately satisfied. Because an insured has the ability to change agents with little or no notice, agents are essentially “up for re-election” everyday.
Value of the Agent
The commission or other compensation earned by the insurance agent not only compensates the agent for the sale of a product but, in addition, professional agents perform these other basic services for the health consumer:
- Agents work with clients to evaluate their need for health insurance protection. This may involve substantial research and fact finding about the client's needs. This is an on-going process since needs continuously change as a person's family and employment situations change.
- Agents educate by explaining the various health plans available and provide appropriate cost indexes.
- Agents make specific recommendations that suit the client's objectives and budget. Often a health insurance plan is designed by the agent to fit a client's special needs.
- Agents encourage the client to act in a timely fashion to assure that the proper coverages are in place when they are needed. They also see to it that accurate and complete information is provided to the insurer to make sure that the client gets the very best premium available.
- Agents review coverage on a periodic basis suggesting changes when appropriate and counseling clients on ways to reduce cost. Often they must assist their clients in reviewing the need for legal and tax compliance, recommending other professional assistance when necessary.
- Agents assist with claims, answer questions and serve as ombudsmen in helping their clients deal with insurance companies. Agents often spend an enormous amount of time helping clients assemble the proper documentation needed to file or follow up on a claim. This is especially true with seniors who receive Medicare benefits.
- Agents help business owners in communicating their benefit packages to employees, often assisting the employee in seeing how the benefits coordinate with their personal financial programs as well as those provided by government entities.
Health Insurance Agents -- Trained Professionals
All agents are licensed and regulated by their state insurance department. Prospective agents receive extensive training about insurance and applicable insurance law prior to taking a written exam leading to licensing. In addition, a majority of states now require continuing education in order for an agent to maintain his or her license.
Many agents who have made health insurance a career have taken a sequence of college-level courses leading to a professional designation, such as the Registered Health Underwriter (RHU), Registered Employee Benefit Consultant (REBC), Health Insurance Associate (HIA), Certification in Long-Term Care (CLTC) or Certified Employee Benefits Specialist (CEBS).
Other insurance designations earned by agents, such as the Chartered Life Underwriter (CLU) and Life Underwriter Training Council Fellow (LUTCF), also include health insurance as part of their curriculum.
Agent Associations
Most career agents belong to professional associations. A life and health insurance agent may belong to a local chapter of the National Association of Insurance and Financial Advisors (NAIFA) and insurance advisors who specialize in health insurance may also be members of the Association of Health Insurance Advisors (AHIA).
These professional organizations provide seminars, workshops, annual meetings and other educational forums to increase an agent's value to his or her clients. They also keep agents abreast of the latest insurance products and regulations through publications and special bulletins. Just as important to the consumer, they require their members to subscribe to a strict code of ethics and encourage them to aspire to a high level of service.
