Small Business Blog

Many people, particularly small business owners, purchase their own  health insurance via private insurance agents. However, according to yesterday’s Wall Street Journal article “Insurers Set Up Shop at a Mall Near You”, this could become the exception someday. Due to the success of several pilot stores, some of the big insurers like Human and Blue Cross Blue Shield, are planning several new brick-and-mortar locations.

Blue Cross Blue Shield in Pittsburgh Strip Mall

“Insurers are increasingly are increasingly setting up brick and mortar retail stores retail stores that peddle individual and sometimes small-group health plans…”       -James B. Stewart, Wall Street Journal

Those of us not working in the insurance industry can only speculate what is causing the shift. Is this an example of a Wal-Mart phenomenon whereby independence and personal service are being overlooked in favor of one-stop-shopping and of course price?  Or are the independent insurance agents to blame? After all, according to a recent McKinsey & Co.  survey, only 48% of respondents who shopped for individual plans were satisfied with the methods of purchase available to them.

I had a chance to catch up with Chris Koller, Social Media Marketing for Prostar Insurance.

Chris Ott: Why has the industry traditionally relied on independent sellers?

Chris Kollar of  Prostar Insurance: Independent agents can tap into many carriers, getting the client best product at the best price. “Captive” agents held to one carrier must sell you their plan.

Chris Ott: What affect does the impending health care bill have on the independent nature selling health insurance, if any?

Chris Kollar of  Prostar Insurance: I don’t believe there will be a change as far as the independent nature of selling but I do believe the cost of insurance will rise.

Chris Ott: Do you think brick-and-mortar will become the standard for insurance comapnies?

Chris Kollar of  Prostar Insurance: Everything we do is web based so are agents are connected and can service anyone in the field at anytime. We do have an office which serves as a hub for us, it helps us internally stay connected and ensure everyone is providing the best service. With that said, we don’t have people walking in off the street and I don’t forsee that becoming the norm. Actually, the web is hot right now and everyone knows it. It’s my job to use social media and the blogosphere to ensure we are connecting with clients who need our services.

Don’t be too quick to assume that the mobile independent insurance agent is going the way of the milkman. According to the same McKinsey study, only 1% of respondents purchased health-care at a retail location. One of the biggest criticisms of the retail model is a lack of accountability. If you work with an independent agent you likely have that agent’s number and a working relationship.  You probably don’t remember the first name of the last person that checked you out of Wal-Mart; kind of a scary feeling when you consider the implications surrounding your family or employee’s health.

The key is to get a good insurance agent referral. Do your research, check the small business directory, and get in touch with agents looking for a long term professional relationship.

This entry was posted on Thursday, September 3rd, 2009 at 12:58 pm and is filed under Small Business Blog. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.