Your clients may think they have all the coverage they need. Many choose the lowest premium that meets their basic coverage needs. We all understand their reasons, with so many other expenses in life. But can they afford to use their coverage? Did you discuss their ability to cover deductibles and the myriad of additional out-of-pocket costs?
Have your clients broken a leg or had a heart attack? The costs all add up: time away from work, reduced overtime, and other expenses they didn’t expect. Life doesn’t get less expensive when they’re sick, which is why advisors should be discussing the implications of using insurance by sharing examples and offering solutions to cover first dollar expenses. Life feels a lot safer when you have an indemnity plan in your back pocket.
Indemnity plans typically provide cash or reimbursements and can be used for any purpose or expense, regardless of network. Whether you are working in the Under 65, Medicare or Employee Benefits markets, indemnity plans make insurance policies work better.
Read on to learn more about the benefits of Accident and Hospital Indemnity plans and how they can solve financial risk for your clients.
Hospital Indemnity: You never know when you’ll need it
Nobody expects to go to the hospital, but it happens. Do your clients know that the risk of being hospitalized nearly doubles at age 65? Even if your clients are in good health, what happens if they fall, break a hip, suffer a stroke, or have a heart attack?
Medicare may provide benefits to help cover medical costs during a hospital stay, but it doesn’t cover everything. A Hospital Indemnity plan can either pay out a cash sum, or reimburse your clients for one or more days that they are in the hospital. This payment can significantly help cover their per diem expenses, unexpected hotel or travel expenses, house maintenance, and groceries.
According to statistics from the Kaisser Foundation, on average, hospital expenses can cost up to $2,271 per day. With Medicare Advantage out-of-pocket maimum’s of up to $6,700, or with high deductible Medicare Supplement plans, your clients could find themselves with expensive bills after just a few days in the hospital.
A hospital indemnity plan is an affordable policy that pays a benefit for each day your clients are confined in a hospital. It may also offer an ambulance benefit and other riders to offset the high costs of hospitalization. Seniors with Medicare will often choose a daily benefit to match the per diem with their Medicare Advantage plan design.
Hospital Indemnity plans are often Guaranteed Issue, and renewable for life when enrolled at age 65. Clients have used Hospital Indemnity plans to assist with the following types of expenses:
- Deductibles or co-pays (things the primary insurance doesn’t cover)
- Travel and lodging (for visiting family)
- Hospital incidentals (TV, private room)
- Other expenses (lawn service, pet care, etc.)
Hospital Indemnity insurance is offered by the following carriers:
Hospital indemnity plans are affordable coverage that protects your clients from the financial risks associated with a few days in the hospital.
Accident Insurance: For the family on the go
Accidents happen. In fact, one in eight Americans each year seeks medical care for accidental injuries. Accident insurance can help with those unanticipated medical costs that come with an accidental injury.
Accidental injuries that are commonly covered include:
- Sprains, dislocations and fractures
- Lacerations, burns
- Eye injuries
- Torn knee cartilage
- Ruptured discs
Your health under 65 clients are the most likely to choose a high deductible plan, and who may find themselves in financial trouble when they have an accident. Accident coverage typically pays out cash, which can be used for any purpose, within days of a claim. Accident insurance is a great choice for all of your clients with young, active families.
Families with active kids are just getting started with their fall activities, like football, soccer, cheerleading, and cross country, among others. What if they were to break an arm or sprain an ankle? What costs would all be associated with that injury?
- An emergency room visit
- Physician charges
- Possible surgery
- Medication administered in the hospital
- Physical therapy and more
One of the most common sports injuries is a torn ACL, which will require surgery resulting in the following expenses: surgeon’s fee, facility fee, anesthesia and graft (if needed). Combined these expenses can add up to $50,000. With an ACA plan, out-of-pocket expenses can range from $7,900 for individuals to $15,000 for a family.
Coverage gaps like these can cause a significant financial setback after an accidental injury, but if your clients have Accident coverage, they can use their benefits to help cover their costs.
Accident insurance is offered by the following carriers:
Accidents do happen, but they don’t have to drain your clients’ finances.
Start the conversation
It’s important to discuss indemnity plans with your clients at every plan review and enrollment, since they are financial lifesavers should the unexpected happen. When talking with your clients, have them think about the following questions:
- Do they have a few thousand dollars in savings set aside?
- Do they have access to a high limit, no interest credit card they could use to pay for out-of-pocket costs?
- Would an immediate cash payout help them through a family crisis?
- Can they rely on family or friends to help?
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