What Does a Health Insurance Broker Do?
Those seeking to understand who is involved in the nebulous system that is contemporary American healthcare will discover a wide variety of individuals, each with unique roles. One such role is that of the health insurance broker, Pflegeversicherung also known as an “independent agent” or “health insurance agent.” This article seeks to shed some light on who the health insurance broker is, what they do and, ultimately, what role they play in the selection of health insurance policies.
A health insurance broker’s job is to provide clients with the most appropriate health insurance policy. Authorized by specific insurance companies to act on their behalf, the broker essentially guides clients through the process of selecting a policy for themselves or for employees. A broker makes his living (and demographics show the broker is usually a “he”) off commissions – sometimes as much as 15%. The rates quoted by broker or by direct contact with insurance provider will be the same because, if the insurance company is contacted directly, the person who makes the sale (known as a “captive agent”) will collect the same commission a broker would collect. Some states even mandate the use of insurance brokers.
In most instances, an individual seeking to be a licensed health insurance broker must take a series of courses then take and pass one or more examinations. Once licensed, a state or employer may require health insurance brokers to take additional classes. Because policies and laws change constantly, a broker involved in continuing education will be more current on applicable law and guidelines and, ideally, better prepared to assist clients. Each state makes its own laws to govern the practices of insurance brokers. While no two states have the same law, increasingly states are recognizing licenses granted in other states. This allows brokers to move without retaking examinations or to operate in more than one state simultaneously.
An individual going into their first day of work as a licensed health insurance broker tends to be older than the average person entering into a given area of employment. This is because the typical health insurance broker has transferred into the industry, usually from a sales position in another healthcare field – hospital equipment sales, for example. An individual with a sales background tends to be comfortable with the demands of the job – like providing excellent customer services, working to maintain a client base, and living on a commission-based salary.
While many come into the health care broker industry having worked professionally in other fields, some do enter the field directly after getting a university diploma. Those coming straight from college are likely to have majored in business or sales. In some cases, health insurance brokerage houses will directly mentor undergraduates – and even offer tuition assistance or loan pay-back plans – provided the undergraduate agrees to work for the brokerage house for a pre-determined number of years.