Voluntary hospital indemnity/supplemental medical products continue to evolve amidst an ever-changing healthcare landscape, finds Eastbridge Consulting Group

AVON, CONNECTICUT, USA (February 4, 2020)

Over half of the participating carriers in Easbtridge’s 2019 Voluntary Hospital Indemnity and Supplemental Medical Products Spotlight™ Report have updated their hospital indemnity/supplemental medical products in the last three years, either making rate adjustments, revising underwriting guidelines, adding benefits, or introducing additional product flexibility. As the healthcare landscape continues to evolve, the newest versions of these products are structured to offset out-of-pocket costs from high deductible health plans and to be HAS-compatible.

Regulatory and compatibility changes required over the past 10 years have created mixed sales results for voluntary hospital indemnity/supplemental medical products, yet the future looks promising: eight of the participating carriers reported sales increases over 2017 results and all but one surveyed carrier have 2019 sales that are at or above target. In addition, strong demand exists from employers and employees for the product. Twelve percent of employers are interested in offering and 43% of employees who do not own hospital indemnity/supplemental medical are interested in owning it on a voluntary basis, according to Eastbridge’s 2018 MarketVision™—The Employer Viewpoint^©and 2019 MarketVision™—The Employee Viewpoint^© studies.

The report helps carriers assess the voluntary hospital indemnity/supplemental medical plans sold at the worksite to evaluate their competitive position. Following are a few key findings from the report:

• Guaranteed issue underwriting is the norm as are group platform products.
• Differentiators mentioned were numerous but include waiver of pre-existing conditions limitations and maternity waiting periods as well as streamlined and integrated claims process with major medical plans.
• Anticipated future trends include continued plan updates in response to regulatory changes and competitive pressure, increased use of composite rates, and expected expansion of maternity and mental/nervous conditions services.

The 2019 Voluntary Hospital Indemnity and Supplemental Medical Products Spotlight™ Report includes data from 17 voluntary hospital indemnity/supplemental medical products of 14 carriers active in the market. Topics covered in the report include product structure and specifics, scope of coverage and portability, rates and commissions, underwriting and claims, competition, results and future trends.

Eastbridge Consulting Group, Inc. is a marketing advisory firm serving insurance and financial services organizations in the United States and Canada.