Wal-Mart Stores has already established itself in Canada in the P&C space – could life insurance be the next step for the colossal retailer?
Wal-Mart Stores has already established itself in Canada in the P&C space – could life insurance be the next step for the colossal retailer?
In the United States, Wal-Mart Stores announced it is getting into the health insurance business, teaming with an agent to offer customers the chance to compare insurance plans and enroll in the one they pick.
The firm, DirectHealth.com, will have agents in 2,700 Wal-Mart stores available online or by phone, according to CNNMoney.
For Jay Scheetz, president of Group Benefits Market in Ajax, Ont., the move by Wal-Mart to offer life coverage comes as news to him.
“I haven’t heard anything about it,” Scheetz told Insurance Business. “Wal-Mart has been doing it in the P&C space, and Costco as well – I don’t know how successfully. I know if you go into a Costco store, there is something for health insurance as well. But being agent, I’ve never run across it – or had a client mention it.”
According to Labeed Diab, president of Wal-Mart’s health 7 wellness unit, “our customers have told us that there is too much complexity when it comes to understanding their health insurance options.”
Research from the Kaiser Family Foundation carried out for Wal-Mart Stores shows 60 per cent of people have difficulty understanding their health insurance options and nearly 40 per cent believe they picked the wrong plan after enrollment.
Given the differences in health care between the U.S. and Canada, Scheetz doubts whether a similar offer on Canadian soil by Wal-Mart would find traction.
“I don’t know the market share here, if it would even be economically viable. It might be members-only, like Costco,” says Scheetz. “Individual health plans are expensive. Coverages are not always that great compared to an employers’ group benefits plan. I’m guessing Wal-Mart is targeting individuals, and today for a family of three or four, you’re looking at $240 all the way up to $400 for an individual health plan. Given the clientele at Wal-Mart, that’s a lot of money for middle-income people.”
DirectHealth will help customers who are age 65 and older weigh 1,700 Medicare supplement plans from 12 leading carriers. Open enrollment for those plans runs from Oct. 15 through Dec. 7. (continued.)
#pb#
Those under age 65 will have access to thousands of health exchange plans from more than 300 companies. The open enrollment period for those customers takes place from Nov. 15 to Feb. 15.
What might be key to Wal-Mart’s success in insurance would be offering a wide variety of insurance products, says Scheetz, a formula that Wal-Mart has built its empire on in the retail sector.
“If they have a kiosk in the store, it could be like one hour photo/one hour insurance,” he says. “That would be useful, if they had multiple products, and they aren’t just selling health and dental insurance.”
In the United States, Wal-Mart Stores announced it is getting into the health insurance business, teaming with an agent to offer customers the chance to compare insurance plans and enroll in the one they pick.
The firm, DirectHealth.com, will have agents in 2,700 Wal-Mart stores available online or by phone, according to CNNMoney.
For Jay Scheetz, president of Group Benefits Market in Ajax, Ont., the move by Wal-Mart to offer life coverage comes as news to him.
“I haven’t heard anything about it,” Scheetz told Insurance Business. “Wal-Mart has been doing it in the P&C space, and Costco as well – I don’t know how successfully. I know if you go into a Costco store, there is something for health insurance as well. But being agent, I’ve never run across it – or had a client mention it.”
According to Labeed Diab, president of Wal-Mart’s health 7 wellness unit, “our customers have told us that there is too much complexity when it comes to understanding their health insurance options.”
Research from the Kaiser Family Foundation carried out for Wal-Mart Stores shows 60 per cent of people have difficulty understanding their health insurance options and nearly 40 per cent believe they picked the wrong plan after enrollment.
Given the differences in health care between the U.S. and Canada, Scheetz doubts whether a similar offer on Canadian soil by Wal-Mart would find traction.
“I don’t know the market share here, if it would even be economically viable. It might be members-only, like Costco,” says Scheetz. “Individual health plans are expensive. Coverages are not always that great compared to an employers’ group benefits plan. I’m guessing Wal-Mart is targeting individuals, and today for a family of three or four, you’re looking at $240 all the way up to $400 for an individual health plan. Given the clientele at Wal-Mart, that’s a lot of money for middle-income people.”
DirectHealth will help customers who are age 65 and older weigh 1,700 Medicare supplement plans from 12 leading carriers. Open enrollment for those plans runs from Oct. 15 through Dec. 7. (continued.)
#pb#
Those under age 65 will have access to thousands of health exchange plans from more than 300 companies. The open enrollment period for those customers takes place from Nov. 15 to Feb. 15.
What might be key to Wal-Mart’s success in insurance would be offering a wide variety of insurance products, says Scheetz, a formula that Wal-Mart has built its empire on in the retail sector.
“If they have a kiosk in the store, it could be like one hour photo/one hour insurance,” he says. “That would be useful, if they had multiple products, and they aren’t just selling health and dental insurance.”
