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This Web site contains a compilation of more than a thousand consumer finance  columns written by Tony Novak from the 1980s through 2006, updated and reformatted for maximum usefulness today.  New material was added after 2010.

Content is the opinion of the author and does not represent the position of any other person or entity. Information is from sources believed to be reliable but cannot be guaranteed.

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Selling medicare supplement insurance

originally posted: 11/22/2006  reposted: 2/18/2011 This post has not been recently reviewed or revised by the author and may be out of date. If in doubt, please send a new question or ask for an update.

Q: I am licensed in Kentucky to sell health and life. Is it possible to contract independently with companies to sell Medicare supplement insurance?

A: Certainly it is possible but I wonder why an agent would want do this. First of all, all of the nation’s largest Medicare supplement insurance plans are non-commissionable. That includes the AARP plan, managed care plans and all of the Blue Cross / Blue Shield that collectively might represent 80% or more of the market. Secondly, the growth in popularity of opt-out Medicare alternative plans (the managed care plans) that means the market share for independent medical supplement insurance has declined. Third, the commercial insurers who might pay commissions offer a medically underwritten insurance. My experience is that less than one in ten applicants could pass the medical underwriting criteria. That means you have nine frustrated clients to every happy one. Fourth, more people are using direct online enrollment for health insurance, including those using Web sites like to enroll in supplemental coverage that might be viewed as a better alternative to Medicare supplement insurance. Collectively, these are not good underlying economic trends upon which you would want to build a business. You might want to try building a business in growing markets like long term care insurance. The online insurance services that are available for agent contracting like the "Iquote" system at make it easy to shop for different products and companies. They also provide the application forms and set up paramedic exams when necessary. All you need to do is be appointed directly with each of the carriers and get then appointed with the service provider like IQuote.


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