Insurance Commissions and More – The Five Driving Forces Behind What You Buy

It’s no secret that most people work to earn a living. It’s how people pay their bills and enjoy their free time. It should also be no surprise that the majority of people will choose the job that pays the most for equal work.

This brings us to a discussion about Health Insurance Agents. They are after all human. And like most others, they work to keep the lights on. And since they work on commission, how much an agent earns is directly related to what their customers buy.

So how does an agent arrive at a recommendation for what’s best for their customer? The answer is deceptively simple. There are five predominant qualifying factors most agents use in their determination:

Brand Name
Insurance Commissions
Price
Benefits
Product Qualification

Brand Name Recognition. Does the insurance company have good name recognition and a solid reputation? Brand names like Blue Cross and Blue Shield and United Healthcare have well established brand recognition in the market place and resonate well with customers. Consequently, when all other factors are equal, agents tend to recommend familiar Insurance Companies over names that their customers may not recognize.

Insurance Commissions. How much will the agent get paid once the customer enrolls in a particular plan? With all other factors being equal, an agent will almost always recommend the plan that pays them the most. This component is uniquely important because most health insurance agents do not receive any benefits or salary. The majority work exclusively on commission. It therefore stands to reason that an agent will consider how much an Insurance Company will pay them as part of recommending a particular plan.

Price. How much will the insurance cost the customer? Regardless of the agent’s sales technique, price is almost always a determining factor in recommending a health insurance plan. With the other 3 factors being equal, the agent will almost always recommend the product that costs the least. Offering a cheap medical insurance plan is an easy way to ensure the customer will remain loyal. It can also help in preventing competing agents from offering a cheaper product down the road.

Benefits. What are the benefits of a particular plan and do they line up with the customer’s needs and wants?

Product Qualification. Does the consumer qualify for the health insurance plan the agent is offering? Different companies have different guidelines for accepting customers. Considerations include current health status, health history, medications and more. Savvy insurance agents familiarize themselves with each company’s requirements before they speak with their customers. They can then recommend the company that is most likely to approve the customer after the application process is complete.

This entry was posted in Uncategorized. Bookmark the permalink.

Comments are closed.