On June 28, 2012, the Supreme Court upheld the constitutionality of the Patient Protection and Affordable Care Act, sometimes referred to as ObamaCare. Immediately, insurance agents were flooded with both positive and negative messages. An article in Forbes, for instance, darkly predicted that insurance agents were being “kicked to the curb” while Daily Finance reached the conclusion that insurance agencies and their employees would come away with “a tidy profit.”
As is so often the case, the truth probably lies somewhere in between the extremist views. As the PPACA is implemented over the next year and a half, insurance agents will face many new situations, some beneficial and some not.
New Pool of Healthy Young Adults
The PPACA legislates that every individual must either carry health insurance or pay a fine. This means that many young adults in good health will be scrambling to purchase insurance for the first time. The agents that pursue this market will have a wealth of insurance leads who are cheap to insure and who will appreciate the guidance of an agent.
New Pool of People with Pre-Existing Conditions
Another new source for insurance leads are people who have pre-existing conditions that currently make them uninsurable. Although these clients may end up costing the agency money, they will also pay a fair amount in premiums to offset the losses. Therefore, there’s no reason why insurance agents shouldn’t reach out to these new prospects.
Mid-sized businesses who employ more than 50 people will be struggling to understand and comply with ObamaCare’s “minimum essential standards.” An agent who understands and can interpret the new law will be valuable to these companies as they select their insurance plans.
Health Insurance Exchange
The health insurance exchange, one of the programs that critics say will put insurance agents out of business, is an online pool where agencies can list their different plans and prices. Customers can buy the policy of their choice online, thus theoretically eliminating the need for agents. This negative prediction, though, does not take into account the fact that some people are uncomfortable buying insurance online, and others will want to talk to a live person before they make a financial commitment. Even with the health insurance exchange program, it is likely that agents will still play a role in guiding consumers to the most appropriate policies and addressing client questions and concerns.
In summary, nothing in the PPACA is inherently hostile to insurance agents. Those who are willing to be flexible and make adjustments should continue to be able to make a living in their chosen career.