Insurelane Insurance Blog

Financial giant ING has a new product on the market: Return of Premium Term Life Insurance. Issued by ReliaStar Life Insurance Company, the policies are available with 15, 20 or 30 year terms. If the policy is surrendered before the term is over, the premiums paid for it will be returned.

“This type of term insurance appeals to people who are concerned about buying a product they think they may never need,” said Jim Gelder, the president of ING Life Distribution. “At the end of the level term period, they get back what they've paid for the policy.”

Since the benefits of term life insurance expire after a certain period, it‘s generally much cheaper than permanent life insurance. By adding a return of premium feature, ING has made term life more attractive — not only to offer protection for families and loved ones, but to use as a financial tool as well.

“In addition to the death benefit protection, return of premium term life insurance can serve as a vehicle for college financing, mortgage funding, business planning or a variety of other purposes,” said Gelder.

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Blue Cross Blue Shield members in Michigan will soon see an increase in their health insurance premiums. Michigan’s Office of Financial and Insurance Services approved a rate increase after the state’s largest health insurance company cited losses in their individual health insurance line.

The adjustment affects 60,000 BCBS members with individual health plans. The increase goes into effect May 1, 2007. Policyholders with group plans will not be affected.

“We sympathize with our members who purchase insurance on their own and face higher premiums as the result of rising medical costs,” said BCBS spokesperson, Helen Stojic. “But the fact is that the premiums we collect for these health-plan options are far below the cost of the medical service delivered.”

Depending on the plan, premiums will go up from 4% to 25%.

Under Michigan law, Blue Cross Blue Shield is the “insurer of last resort,” and required to accept any applicant — regardless of their health status or medical history.

“This differentiates us from for-profit insurers, who cherry-pick young and healthy people and often turn away people whose medical conditions make them too high a risk in the eye of the for-profit insurer,” Stojic said.

“The rates bring the premiums closer to the actual cost of care provided, but not all the way,” she added.

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Philadelphia-based Independence Blue Cross has announced it will extend it’s “No Pay Copay” generic drug promotion until the end of 2007. The promotion gives Independence members free prescriptions and refills on generic drugs. The promotion was originally scheduled to last until the end of March.

Independence Blue Cross hopes the promotion will increase awareness and use of generic drugs, saving money for both the company and its members.

“Our members have responded very positively to our No Pay Copay promotion,” said Independence Blue Cross president and CEO Joseph A. Frick. “In just a few months, we’ve seen a five percent increase in the use of generic drugs. By extending the program through the year, and expanding it to include even more members, we hope that those who are already using generics will stay with them to continue to save on their prescription drug costs, and others who have yet to switch to generics will consider making the change.”

According to the Congressional Budget Office, a Federal agency that reviews budgets and legislative initiatives, healthcare consumers save as much as $10 billion a year buy using generic drugs instead of their brand-name equivalents.

“Generic drugs are much less expensive, and if they meet the clinical needs, then everybody wins,” said Blue Cross pharmacy vice president Paul Ulrick.

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The Ohio General Assembly has introduced legislation aimed at simplifying the relationship between healthcare providers and insurance companies.

Under provisions of the new bill, insurance companies will be required to have an online system of up-to-date enrollee information that’s easily accessible by doctors. It would also make an online database of all doctors’ credentials available to the healthcare industry. This would cut down on administrative work, and make it easier to approve doctors to practice in new networks.

Another goal of the measure is to sort out insurer’s reimbursement policies to care providers. A summary and disclosure will be required for every provider-payer contract. All fee schedules, payment policies, and categories of coverage must also be well clarified for doctors, hospitals, and other care providers.

“It frees up more time to commit resources for patient care and not so much toward the administration side,’ said the bill's main sponsor, Republican State Senator Kevin Coughlin.

The bill is a bipartisan effort to make the Ohio healthcare system more efficient and to save money for statewide healthcare costs. It can also make it easier for the patient, enabling the doctor to easily clarify which medical care procedures are covered under their health plan.

“Everything that we can do to reduce healthcare costs goes a long way,” Coughlin added.

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