The Critical Illness Insurance Market Continues to Trend Upward in the US

It’s no secret that healthcare costs in the U.S. are on the rise. One way of combatting these rising healthcare costs is with voluntary healthcare benefits. A recent report released by LIMRA/Career Builder shows that the critical illness insurance market is trending upwards which is great for people who are looking for ways to help offset these rising costs.

In 2016 alone, the costs of care hit over $10,000 per person. Variables such as partisan politics, chronic illnesses—such as diabetes and heart disease—rising drug and medical costs have significantly contributed to why these costs will continue to spiral upwards for at least the next decade.

According to Benefits Pro, brokers adding and selling voluntary benefits to their sales portfolio can increase their bottom line significantly.

“A typical critical illness insurance policy carries a $2,200 premium, with a 70 percent first-year commission and 4 percent renewal commissions paid to the writing agent.”

The critical illness insurance market is ripe with opportunity

critical illness insurance market

The following are stats from the study that benefits brokers should take into account when considering adding more supplemental options to their sales portfolio:

  • 24 percent of employers offered critical illness insurance to their employees in 2017 compared to just 19 percent in 2006
  • 78 percent of full-time workers state they are, at some point, living paycheck-to-paycheck
  • 26 percent of households in the U.S. have difficulty paying medical bills in a given year
  • 55 percent of employees say they could pay an unexpected $500 medical bill right away. Of that 55 percent, only 30 percent could do the same for a $4,000 bill. The average family deductible for a high-deductible health plan is now over $4,000
  • 17 percent of employees without critical illness insurance said they wouldn’t be able to pay an unexpected $4,000 bill whatsoever. Of those who had critical illness coverage, only 10 percent said they wouldn’t be able to pay the bill
  • Despite increasing sales, only 38 percent of employees overall have purchased critical illness coverage when given the opportunity. Only 33 percent of employees who are offered critical illness insurance feel knowledgeable about it
  • Only 25 percent of employees understand that critical illness insurance pays out a lump sum that can be used for anything upon diagnosis, not just medical expenses
  • Only 8 percent of this grouping can identify the conditions covered by a critical illness policy

critical illness insurance market

Offering your clients opportunities to help their employees

One of the biggest takeaways from this section is that people are just not educated enough on the positives of adding a critical illness insurance policy to coincide with their healthcare plan. They don’t realize just how impacted they will be economically in the event of a critical illness striking them or their family.

Benefit brokers can help educate their clients that a traditional healthcare plan may not be enough in today’s unpredictable healthcare climate. Also they might not be aware of how critical illness insurance can be a safety net for those healthcare plans that have extremely limited coverage. For these reasons, the critical illness insurance market is definitely on a year over year upward trend.

For more information on critical illness insurance, please read 5 Reasons Benefits Brokers Should Offer Critical Illness Insurance to Their Clients.

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