When Sen. Max Baucus, one of the writers of the Affordable Care Act, likened ACA to a “train wreck,” what do you think the impact was on seniors? Do you think this will cause more or less confusion about Medicare than we already have today? Are you prepared if one of your clients asks you what to do about Medicare?
If you are prepared, then you are in a small minority. Most insurance advisors I talk to really don’t spend much time on Medicare Supplement (also known as Medigap) insurance. This is great news for you because it means you can gain a tremendous competitive advantage by becoming known as the Medicare expert seniors can trust. Once you have established a trusting relationship, you have earned the right to help those senior clients solve other problems around life insurance and estate planning, long-term care and related issues.
I would say most advisors have vastly overlooked the Medicare market, and this opens a tremendous opportunity for you. By being able to address your clients’ concerns about Medicare, you can generate a lot of new business while helping a great number of people.
The future of Medicare is actually the No. 1 concern of seniors, as you can see on a chart with this article.
You can brand yourself as the Medicare guru in your community and earn additional business by addressing Medicare issues.
A number of Medicare information resources are available to seniors, but only one resource can look out for seniors’ best interests by giving personal advice.
One of the first places where seniors can go to get information about Medicare is, of course, the U.S. government, which regulates it. A great handbook is available online and I recommend
all advisors to read it: (http://bit.ly/innm0713-med). However, will the government provide people with information or with advice? If you said “advice,” guess again; information is about all someone can expect. Having information is one thing, understanding it is another and benefitting from it is still another.
Seniors also have organizations such as AARP as a resource. These organizations also can provide information, but how much personal advice can you obtain through e-mail, a website or an 800 number? Don’t be surprised if many of these organizations have their own products to market as well.
That, of course, leaves the insurance advisor or financial professional as a potential resource. Well, if we were to travel within 100 miles of your office, how many advisors really could explain the recent changes in Medicare and advise people on the best coverage for them right now based on their individual situations? My guess is that you can count them on one hand. That means you have a wide-open opportunity to become the go-to resource about Medicare. Let’s discuss how to begin.
As a starter, you really should read that government handbook on Medicare and know it from front to back. Here’s why. Every underwriter has to offer the same Medicare supplement policies because they are regulated by the government. Even though the policies are the same, the premiums may differ. Each underwriter may have different rating system as well. But the policies are the same.
Next, every person needs to choose between traditional Medicare and Medicare Advantage. If someone chooses Medicare Advantage, he can’t buy MedSup. Which is better?
You need to help your clients answer that question based on their situation. Medicare Advantage is more like an HMO, so will your clients’ ability to choose their own doctor be important? What if your clients move? Will health care providers be available in their new location? What if your underwriter goes out of business? Will your clients need to pass underwriting again? As for a Medigap policy, how do the premiums compare to Medicare Advantage? Can your clients use their own doctor? Is the policy portable? Should they choose Medigap Plan F? Plan N? What is the best choice?
Now, if you can’t answer the previous questions, how do you think the average senior feels? How do you think that senior will feel about you if you sit him down and help him figure it all out in a single meeting? I think it is much easier to understand and present this subject than it is to understand and present many of the more sophisticated types of life insurance, such as variable universal life.
Once you help clients solve their Medicare issues, you easily can go back and help them resolve other issues like life insurance, long-term care insurance and annuities.
Obviously, the first step is to develop good relationships with your carriers. Understand how your carriers work, how their premiums compare to those of other carriers, and how they will serve clients when they file claims in the future. Next, talk to some of your carriers’ wholesalers. Eighty percent of all their Medicare revenue comes from 20 percent of their policies. You need to find out all you can about those 20 percent and develop a presentation that incorporates that information. Your wholesalers probably will be able to help you with sales literature as well.
Lead generation actually is the easier part of this. Start by calling people age 67 or older instead of calling those just turning 65. As a general rule, those who are 67 and older already have found out that they made a mistake and you can help them fix it. Let people know that you can help seniors resolve their issues around Medicare. Ask them if they or someone they know would like help. Get your pen ready and make sure you follow up. Nothing looks worse than having the person who recommended you feel embarrassed because her friend said you never called.
The opportunity to get new clients by establishing yourself as the go-to Medicare expert in your community is wide open. Starting new relationships around Medicare will lead to other business such as life insurance, annuities and long-term care insurance. Deepen your relationships with your carriers and wholesalers to get good sales tools and, most importantly, follow up with all referrals.