AGENT'S SALES JOURNAL asks Scott Golden to give the "Top 5 Reasons People Don’t Buy Health Insurance — And What You Can Say to Help Them Reconsider"

By Scott Golden, CFO
Golden & Cohen
November 2009
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Why should individuals rely on a professional to assemble comparisons of various plans only after a fact-finding conversation with the agent? That’s a question that has been raised regularly in my office, especially since the discussion has heated up on health care reform. The reality is that agents like yourself — good ones, at least — are essential and continue to be relevant, for you can bring viable options to the table that the individual may not have otherwise considered.

Why do people need an agent to help find the right policy?

Truth be told, there are some sophisticated, high-tech services out there, and more effective online tools seem to pop up regularly.

However, I have found that using the Web alone usually does not give the individual all the information needed to select the best plan. There is more to the issue than which plan is cheapest. And sometimes, you have to not just read the fine print, but also read between the lines to determine what the plan truly offers.

If all the insurance carriers in America were required to have one universal format for benefits presentations, it would be much easier. Unfortunately, that is not the case. And it is exactly why a trained, professional agent still plays an important role in the health insurance equation.

Of course, all too often, this discussion falls on deaf ears. The fact is that although nearly 250 million Americans do have health insurance, according to a monthly survey of about 50,000 households done by the Bureau of Labor Statistics and the Census Bureau, an estimated 46 million Americans do not.

Although pending health insurance reform may change all that, this also puts the future of health insurance brokers in jeopardy — especially if more people start buying their policies online. So consider these points, as well as how you can counter the arguments you hear from potential customers.

1. It costs too much

The reality: Even with the reforms being considered by Congress, we’ll likely hear this complaint. It’s critical that everyone have health insurance, because if a catastrophic illness or injury occurs, it would likely bankrupt most people without coverage.

It’s the terrible fact of life in 2009 — medical care is incredibly expensive, and employers are increasingly less likely to be able to support an injured or ill employee. So if something happens to one of your client and they haven’t saved enough money to be able to support themselves if they are unable to work, the odds are good that they will be in debt for astronomic health care bills — and, unfortunately, many of your clients would be hard pressed to ever climb out of that financial hole.

2. It does not cover all of the health care needs that I have now, or might have in the future

The reality: The truth of the matter is that a good health insurance agent can usually find a policy that covers most every medical problem that is likely to arise. There are also resources that can be used to supplement your clients’ plans. For instance, if they need discount drugs, it is possible to fill their prescriptions at Wal-Mart or in Canada, and they can get flu shots at their local pharmacy. If you’re good at what you do, you can encourage your clients to find ways to help themselves — and help them do so.

3. The process of finding the right health insurance is too complicated

The reality: Consumers think that the process of understanding a policy is just too difficult, so they tend to shut down before they even try to take the time to comprehend it. Encourage them to not give up too soon. That’s why they need to hire an agent who is patient and will help guide them through the process. Be willing to be that agent.

4. I am healthy and do not need health insurance today

The reality: That’s great — until, of course, the client does need it. And they will. We’re all human, and humans will get sick and need to see a doctor. Encourage your clients to be safe and protect themselves against the inevitable. Tell them that in the case of a catastrophic incident, this ignorant assumption cannot be undone.

5. I want to wait until health insurance is cheaper

The reality: This brings us back to the first reason consumers don’t buy insurance, but it’s really the key problem. Insurance is expensive, and for the foreseeable future it will continue to be unaffordable to many. It is heretic to admit, but insurance companies do not make billions for their shareholders by helping the little guy. We are easy targets. We have no lobbying power, and they know it.
So encourage the people you meet with to be smart. At the very least, have them buy a health insurance policy that will cover them in case of a catastrophic event. Health savings accounts are a good option, and more solutions are coming on the market. Don’t lead them astray because it’ll help your bottom line. Instead, be their trusted ally — and everyone will benefit.

Scott Golden is the chief financial officer of Golden & Cohen. He can be reached at