Do you need Critical Illness Insurance?

September 17, 2015 Ray Catudal

Image of yield sign saying "At your own risk"This is just one of many questions facing consumers this open enrollment period. Questions abound for consumers regarding the purchase of ancillary coverage or what some call voluntary benefits. And, these questions will arise regardless of whether you have employer sponsored coverage or individual coverage because voluntary benefits or ancillary coverage has pushed itself to the forefront of healthcare with the rise of HDHPs and defined contribution models.

According to a recent Kaiser study, brokers, assistors and HR representatives are so busy trying to explain the traditional medical options and benefits to consumers they are less available to explain voluntary products. This leaves all of those questions mentioned above unanswered. It perpetuates confusion and frustration among consumers.

Although only 20-35 percent of voluntary sales go through exchanges, more than 50 percent of brokers and 33 percent of carriers perceive that the ACA has helped with the overall sales of voluntary and ancillary benefits, according to an Eastbridge Consulting Voluntary Benefits study. With exchange adoption rates expected to increase enormously by 2018, it is safe to assume that more consumers will be presented online with voluntary benefits options.

Skeptical Millenial with iphone imageSo how will you explain the value of your ancillary offering without the presence of advisors at the point in time when consumers make decisions? While consumers may understand why a dental product makes sense, how will you explain the need for a disability product to a Millennial?

There is a way for health insurance organizations to provide advisory and education services that address voluntary and ancillary services without adding headcount. By using Intelligent Virtual Assistants (IVA), organizations can double down on the experts available without increasing the spend on hiring, training and managing employees and call center reps. IVAs can be relied on to help the consumer understand the value of voluntary products. Avatars act as advisors and explain under which circumstances voluntary products such as life, accident or disability make sense. Virtual assistants can help consumers understand the value of ancillary products and they can also simplify difficult service offerings while educating consumers on terminology that may be confusing. This all helps companies avoid losing members and stops abandoned applications.

Image of life insurance checkboxVoluntary sales will continue to grow, in part due to the growth in HDHPs. In addition, the defined contribution model helps consumers become more conscientious shoppers of health insurance. With a fixed amount available and more personal choice, consumers have started to buy down on major medical products in order to buy up on voluntary products, according to Willis Human Capital Practice.

Giving employees the opportunity to use defined contributions allows them to spread their spend across multiple products and more according to their personal needs and not according what the HR department thinks. Allowing consumers to become more educated makes people behave more efficiently and buy only those plans that they need. More personal choice is good, but it also requires explanation.

With the rise in HDHPs, HSAs and consumer driven health care, consumers are becoming more responsible to manage their own health. Employees can no longer look to HR and have them make decisions for them nor can the just passively enroll. They have to make their own choices and therefore understand their options and their coverage better.

So to go back and answer our first question: Do you really need critical illness insurance? Well, it really depends on your personal situation. But, a virtual assistant can be available to help walk you through the decision.  

About the Author

Ray Catudal

As Director of Healthcare Consulting, Ray is focused on CodeBaby’s healthcare specific customers and delivering on CodeBaby’s mission of customer centricity. With over 20 years of experience in medical devices, healthcare and technology, specifically: ehealth, health insurance, and software, Ray is a subject matter expert who contributes to industry articles, and speaks at trade shows and events.

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