New York Times Article

A Broker Can Help Unscramble Individual Policies

By Leslie Alderman

The new health law will be a boon to self-employed individual, who typically pay more for insurance than those covered by group plans.But they will have to wait: the much-anticipated health insurance exchanges, which will provide an easy way for consumers to compare plans and offer federal subsidies to those who qualify, isn't scheduled to go live until 2014

** (The article continues with an explanation of how an agent can save you time and money.)**

For now, self employed individuals must brave the health insurance terrain on their own. One way to do that is to enlist a seasoned insurance professional, who can find a plan that fits your particular situation.

For many years self employed individuals were able to find affordable plans for themselves, but as rates skyrocketed and insurance plans grew more complex, finding affordable coverage became "nearly impossible."

A year ago, Marc Farre got fed up with his escalating premiums, which had reached $13,200 a year, and called a local insurance broker for advice. The broker helped Farre and his wife find a new policy that met their health and financial needs.

Health insurance brokers, who are paid a commission by insurance companies but are free to consumers, are busier than ever, though some worry how the health reform act will affect their livelihood.

A representative of the National Association of Health Underwriters reports, that brokers are reporting that the number of calls they receive has quadrupled since the president signed the health reform bill into law last March.

The organization represents nearly a third of the estimated 500,000 to 600,000 active health insurance brokers in the United States. More than a third of individuals who purchase insurance on their own use a broker, according to the Kaiser Family Foundation.

When Farre met with his broker, he had only a vague understanding of what "high Deductible" health plans were actually like, and what he knew of them he didn't like. The broker spent two hours explaining insurance options to Farre, and following the session he decided that a high- deductible plan linked to a Health Saving Account (HSA), made good sense. The broker directed him to a plan specifically for sole proprietors, which in New York are much cheaper than plans for individuals.

Farre and his wife, who have no children and are in good health, now pay $2400 a year in premiums, less than half of what they paid for their previous plan, but they also each have a higher annual deductible. They each put $3000 in their health savings account to pay medical bills. Once they reach their deductible, the plan covers their medical bills at 100 percent.

Brokers offer consumers policies from the majority of insurance carriers. They can recommend government and state plans as well. When you buy a policy through a broker, it costs the same amount as when you buy directly from the insurer. The commissions that insurance companies pay brokers vary by state; in New York the fee is typically 4 percent of the premium.

In addition to helping you find a plan, a broker can be your advocate once you have purchased the policy. When Farre received multiple emails from the insurer saying he had not sent the required recertification papers, (he had), the broker help solved the problem.

Not all brokers provide stellar service, if you are considering using a broker to help you find a new health insurance policy, here's what to look for.

Strong Reputation: Ask everyone you know, including brokers you use for other insurance, for referrals. A broker may have sold your family a homeowners' policy.

Breath of knowledge: Even if a broker comes well recommended, ask a few pointed questions. Find out if he belongs to a professional organization like, Independent Insurance Agents and Brokers of America. Though membership does not guarantee the broker will be a whiz, it's an indication that the broker takes their job seriously.

Ask Good Questions: Listen, also, to what the broker asks you. Brokers should try to identify your needs and desires for coverage and find out what you can truly afford. If a broker tries to steer you to a pricey plan without laying out the options in a comparative format, be very wary of his advice.

Customer Support: Some brokers will come to your house or office; others will hold meetings in their office. Ideally, you want a broker who remains attentive to your queries, not just before you buy the policy, but after you've signed the agreement as well. Ask the broker how problems or complaints are handled. "The correct answer is, "Call me and I will help you with any questions you have about the policy. According to recent survey of brokers, most spend half their time helping clients after they've purchased a policy.

And remember, you can always drop a broker if they turn out to be less than adequate for your needs. Once you have the policy, you are free to transfer it (and the broker's commission) to a new representative who may be better at helping with problems, and ensuring that the policy you signed up for remains the best deal for you and your family.


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