I will follow John's lead and take on group health. There are several people who are more qualified to write this (Like Bob) and I hope they will add to it.
I think that the first address for anyone trying to sell small group health is to visit the state department of insurance website. They are all listed here
http://www.naic.org/state_web_map.htm You can usually find a list of companies that operate
HMO's in that state. Some states, like Wyoming, have just one or two. Other states may have ten or more. It takes very little for an insurance company to be licensed to operate in most states, but it takes a lot of compliance to run an
HMO. That means that this company is probably committed to doing business in your state.
You can call a handful of the companies and ask if they write direct or through wholesalers. In my opinion, you are far better off if there are a couple of wholesalers that operate in your state. Usually, they just take overrides that you would not have access to anyway. I have found that they usually give much better training than life wholesalers do.
They are usually happy to give you an education about the state laws, products, and specific markets. The most important information to find out is:
Do they offer all of the companies in the area?
Do they give you the full commission?
Will they come on meetings with you?
Who owns your book of business?
What is the state law on medical underwriting?
How much is the allowable rate up?
Can you get a rate down for a healthy group?
Are renewals pooled or underwritten?
Can you BOR a case that they already hold?
There are several wholesalers that operate nationally. Benefitmall and Rogersbenefits are the biggest.
Many regions have local outfits that do an excellent job. I have found that states that do not have wholesalers are often not very profitable places to write small group health. In my opinion, it is much easier to crack the market in guaranteed issue states, because you don't need too much information to get fully mature rates. It sucks to get a census, beat their rates, take apps and then get rated up to wazoo because of a hip replacement.
Commissions from reputable companies range from 1% to at least 7% and renewals often pay the same. Many companies are switching to a per enrollee or per subscriber commission. With those deals, you can make out better on the young groups and worse on the older. Bonuses can give you a substantial boost for persistency and numbers. Commissions are almost always on an as earned basis. It is also important to note you will not be getting a check when the group first goes live. This is a slow business and you need to be able to pay your bills for a while before the checks start coming in.
Underwriting is what makes or breaks you in this business. New York bases all their rates on county; they don't even care about age. Arizona can rate you up to 400%. In underwritten states, some companies will give separate rates for each employee others will average it in, so the laws on underwriting are very important. Some factors that may go into the underwriting are:
Average age
% of employees that are female
SIC code
Zip code of the business
Zip code of each individual
Overall health status
Individual health status
Current and renewal premiums
Once you have a case on the books, there is huge opportunity to cross-sell. You have free access to every single employee and an excuse to call them at least twice a year. You may also know their age, family size, where they live, and health issues that may affect their need for other products. Whenever I run my employee enrollment meetings, or do a general presentation, I drop in some information about other products into the presentation. You may be pitching group health, but it is a great opportunity to present your other areas of knowledge.
If anyone needs help getting started in their local area, you can email me and I will try to point you in the right direction.
Small Group Health 101 for New Agents
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