A few days ago American National Insurance company announced they are discontinuing the marketing of Texas Health Insurance... Well,they are starting to fall like snowflakes on a mountain top. We told you this would happen, no one believed us. Well, it's happening, and doing so at an alarming rate. That makes four companies that have vanished since the health care reform battle broke out. How many more to follow? Who knows, but we told you this would happen. Let's set up the American National Insurance of Texas exit:
From the Press release: "American National Insurance Company's subsidiaries, American National life Insurance Company of Texas and Standard Life and Accident Insurance Company will discontinue the sale of Individual Medical Insurance effective June 30th, 2010. American National will continue to serve the Medicare Supplement and large group markets as well as other supplementary products." According to the press release the reason for the exit is the passage of the healthcare reform legislation.
Ok, so what now? Well American National Life Insurance of Texas and their parent American National Insurance Company have been around forever. Back when I was a kid my parents purchased one of their widely popular children life insurance policies on me. That was almost 50 years ago. Everyone over 60 knows of these guys, it's sad to see them leave... But why? Why not stay?
American National sold very few what I consider full Texas Major Medical Insurance policies. Most of their offerings had limits, limits to the degree that I would not offer their products. Their pricing on their better products was just not competitive in this tough Texas Health Insurance market. The products that were low-cost simply, in my opinion, were not quality coverage. Back in the day American National Life Insurance Company of Texas had some quality stuff, and I marketed it heavily but not for the last 5 years.
It seems their target market was more aligned with the captive agent, those who only sell for one company. They also were more focused on paper applications, meaning an agent had to physically visit the Texas Health Insurance consumer. Those days are over, most of the bigger players in this business do online applications and the consumer never sees the agent.
The healthcare reform law jammed through Washington spells out very clearly the fate of insurance policies that have limits and it appears ANLIC found its products to be non conforming so rather than conform they ejected. They won't be the only one to have their product portfolio destroyed by the new insurance law. Out of all the provisions in the new legislation this is one I support. I feel consumers look to agents for guidance on which policy to purchase for their family and all to often agents are provided with a oppertunity to supply a consumer a policy that fails on the quality end of the spectrum. We should eliminate all the Texas limited benefit health insurance policies and the hospital surgical expense policies. Overall consumers will be better off because half the time the consumer doesn't have a clue what their policy will cover, it's hard enough to provide adequate coverage from what is considered major medical policies and insuring a client in a limited benef it policy just makes it that much more difficult for folks to understand.
As an independent broker I am tired of competing against policies that I know are limited in coverage, however because what another agent told them they just flat-out don't believe me when I tell them the coverage they are considering falls short of their coverage goals, or the price of these limited policies is so much cheaper that the consumer elects to gamble with their personal bankroll. So for this reason I am glad that these limited policies are being eliminated, as well as the agents that make their living marketing limited benefit products. Nothing against American National, I think the world of them, I just didn't like the direction they had chosen to go with some of their products.
If you are a current policy holder of American National Life Insurance Company of Texas now would be a good time to shop for new Texas Health Insurance Quotes. As a broker representing all of the major players in the market we can provide you quotes instantly from companies like Aetna, Blue Cross and Blue Shield of Texas, Cigna. United HealthCare and Humana just to name a few. I recommend you review your options quickly as who knows what happens next.
If you are a current policyholder of ANLIC don't panic, there was no mention in the press release of the elimination of current policyholders, but that could be an option, we just don't know yet. I hope not. I'm sure there will be more to come from American National Life Insurance Company of Texas very soon as well as other companies following their move. Stay Tuned!!
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