Product Flexibility In Voluntary Dental Market Increases

By Cyril Tuohy InsuranceNewsNet

By Cyril Tuohy

Over the past five years, the voluntary dental market has introduced more product flexibility. Prices remain competitive as more insurance carriers enter the group medical arena, according to a voluntary benefits market expert.

The greater the choice, the more important it becomes as a differentiator for insurance carriers, said Ginger Bates, director of research for Eastbridge Consulting Group, which issued its findings in the 2014 Voluntary Dental Products Spotlight Report in April.

The last time the study was conducted was in 2009.

The Eastbridge report includes data from 14 voluntary dental products. The details include product structure, benefit design, networks, coverage amounts, deductibles and plan options, underwriting guidelines, enrollment practices, and costs and commissions.

Voluntary benefits are paid for 100 percent by the employee through a payroll deduction. The benefits are offered in addition to shared benefits, benefits for which the employer and the employee contribute to premiums.

Other insurance products, such as disability coverage, term life and vision coverage, can also be offered in the voluntary market.

Voluntary dental sales make up between 25 and 35 percent of total voluntary sales for most insurance carriers that offer voluntary benefits, Eastbridge said. New sales of voluntary dental coverage last year comprised about 13 percent of the overall voluntary sales, she said.

Voluntary benefits sales reached $6.64 billion last year, up about 10 percent from 2012, Eastbridge also said.

With health reform, employees are finding their way around a new purchasing landscape and are unsure about how much their regular health benefits will cost, and how much their employers will contribute to the subsidy.

In addition, insurance carriers are “uneasy” about the “unknowns” surrounding pediatric benefits, she said.

“They just aren’t sure how things are going to play out with the pediatric requirements in particular and with the exchanges as a whole,” Bates told InsuranceNewsNet.

Private health care exchanges, managed by benefits brokers, specialty health and benefits companies and insurance carriers, cover employees enrolled in group health programs.

Public health care exchanges, managed by the federal and state governments, ensure that everyone not covered through group health plans can buy coverage as required by the Affordable Care Act.

As of last month, an estimated 8 million people have signed up for coverage under the federal exchange, the government announced.

Bates also said that many insurance carriers are monitoring the trend of packaging dental products with medical benefits, and how that will affect the voluntary market.

Cyril Tuohy is a writer based in Pennsylvania. He has covered the financial services industry for more than 15 years. Cyril may be reached at [email protected].