As an insurance agent, you understand there is no insurance that covers every possible scenario life throws at your clients. Protecting clients from coverage gaps is essential. Gaps in insurance coverage can leave individuals vulnerable to unexpected financial burdens. No matter what type of insurance you offer, it is important that you understand and address these gaps. This is crucial for your client’s peace of mind and financial security.
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Identify the coverage gaps
The first step in addressing coverage gaps is to identify them. This requires agents to review existing insurance policies and assess any potential financial risks. Below are a few common scenarios where coverage gaps can cause issues.
Underinsurance
In some cases, the coverage limits of a plan are insufficient to fully protect your client in the event of a major illness or accident. This can cause financial liability.
Exclusions
Health policies exclude specific conditions and or circumstances. This leaves enrollees without protection in some situations.
The client’s needs change
When there is a change in an individual’s life, such as marriage, the birth of a child, a death or the loss of a source of income, your clients may need to rethink their insurance coverage choices. They may want to add a life policy, long or short-term care policy, some other policy type or change coverage amounts.
Gaps Between Policies
In some instances, there are overlaps or gaps between different insurance policies that leave clients exposed to financial risks. If the client has a long-term care policy, they may need to add a short-term policy, or another specific plan designed to provide financial assistance during the waiting period imposed by their long-term care policy.
Strategies to Protect Clients from Coverage Gaps
Once you identify the gaps in coverage, it’s time to take action. Here are a few strategies agents should consider.
Agents should prepare a potential “menu” of policy types that can be used together to meet specific coverage needs not met by traditional health care policies. Good, better and best bundles are a good idea to have ready to show clients so they can find the best options for their budget. Each bundle can include a few product choices that fill a specific need such as dental, vision and hearing, cancer heart attack & stroke, final expense, disability or critical illness.
Review and update coverage
If you are an effective agent, it is a good idea to regularly check your client’s insurance coverage to ensure their needs are still met in a comprehensive and affordable way. This is a good way to avoid coverage gaps and update limits.
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Bundle Policies
Many insurance providers offer discounts when an enrollee bundles multiple insurance policies. This can help ensure comprehensive coverage as well as fill gaps between different types of insurance.
Supplemental Insurance
Supplemental insurance policies cover specific risks not adequately addressed by your primary policies. For example, a cancer policy provides coverage for expenses and treatments beyond what is offered by your health policy. Specialty policies can provide coverage for specific conditions clients may have a chance of being diagnosed with.
Insurance professionals provide viable options and advice
Because navigating insurance coverage can be complex, a licensed professional can provide affordable options and explain coverage details that a client might miss. They can help identify potential coverage gaps, recommend appropriate ancillary policies, and ensure clients have the protection they need for their own unique situation.