The tragic killing of United Healthcare’s CEO, Brian Thompson, has reignited discussions about consumer dissatisfaction with the insurance industry. While health insurance often dominates these conversations, many consumers are surprised by how functional the health insurance industry is as compared to other types of insurance. Commercial, homeowners, and auto insurance, in particular, are often riddled with inefficiencies and leave policyholders feeling unsupported and frustrated.

A Broken System Across the Board

Insurance as a safety net has turned from a product that truly protected and reimbursed the policyholder, to a system fraught with complexities, call centers, lack of transparency in nearly every turn, and a real sense that the industry is far from the “love like and follow” culture desired and breaded by consumer-centric companies like Google Apple and Amazon. From individuals to businesses, the entire insurance experience is consistently marred by red tape, opaque policies, and a lack of accountability. For many, the process of filing a claim—whether for a personal auto accident or a business interruption—feels more like an uphill battle than the safety net they were promised.

For homeowners’ policies, there has been a record number of fires floods and natural disasters causing widespread destruction. Navigating insurance after disasters is fraught with delays and denials. Consider a family in California whose home was destroyed by a wildfire. Despite holding a comprehensive policy, insurers traditionally negotiate settlements for over a year, leaving them to juggle temporary housing costs and rebuilding expenses. Stories like this are common and erode trust in the industry.

Commercial business of all types face equally daunting challenges. Commercial insurance policies, which are vital for small and large businesses alike, often come with unclear terms and inadequate coverage. A manufacturing business can significant losses after a storm causes structural damage to their facilities, despite having a business interruption policy negotiating and adjudicating claims can lead to months of delays and force companies to scale back operations. No product delivered to business owners has escaped the challenging and tedious process of securing, renewing or managing business insurance.

Auto insurance is another frequent source of frustration. Drivers often face higher premiums after filing claims, even when they were not at fault. Cancellation after use is likely. Rates are near prohibitive for young drivers. The promulgation of  marketing billboards and “call to action” injury hotlines have fueled an “accident turned lawsuit mentality”. The system is challenged

The Business Impact

For business owners, these insurance inefficiencies can be catastrophic. Small businesses, in particular, struggle to recover when insurance is poorly written or ambiguous. Whether it’s a denied claim for property damage or delays in liability settlements, these roadblocks can disrupt operations and jeopardize livelihoods.

Meanwhile, the insurance companies themselves continue to thrive. Stock prices for major insurers, including those offering commercial products, climb quarter after quarter. This financial success highlights a stark disconnect between corporate profitability and the real-world experiences of their customers.

A Call for Industry Reform

Can insurance companies move the needle – even slightly???

The insurance industry must evolve to meet the needs of its consumers. Businesses and individuals alike deserve products that work when they are most needed. To rebuild trust and ensure long-term success, insurers should:

1. Increase Transparency: Clearer policies and communication will empower consumers and reduce misunderstandings.
2. Streamline Claims Processes: Investing in technology and customer service can significantly reduce delays and frustrations.
3. Focus on Fairness: Insurers must commit to honoring legitimate claims promptly and equitably, regardless of the size of the payout.
4. Adopt a Proactive Approach for Businesses: Commercial clients require tailored solutions that adapt to the unique risks and challenges of their industries. Insurers must work collaboratively with business owners to create coverage that supports long-term resilience.

The Path Forward

Reforming the insurance industry isn’t just a matter of improving customer satisfaction; it’s essential for maintaining the industry’s credibility. By shifting focus from shareholder returns to consumer needs, insurers can restore faith in their role as protectors. This shift is critical not just for individuals but for the businesses that drive our economy. It’s time for insurers to recognize that their success depends on the satisfaction and security of their policyholders. By embracing transparency, efficiency, and fairness, the industry can finally begin to repair its fractured relationship with consumers. The general public has no way of moving the needle on the consumer experience – its entirely on the shoulders of every officer manager, executive and employee at every insurance company to start the process.

As a small business, you’re likely familiar with the challenges of meeting health insurance contribution and participation requirements. Fortunately, there’s a crucial solution available annually—the Special Open Enrollment (SOE) Window. This period, mandated by the Affordable Care Act (ACA), allows Small Group employers to offer medical coverage to employees without needing to meet the usual contribution or participation thresholds. It’s an opportunity that can ease the burden for businesses that may otherwise struggle to meet these requirements.

What Is the SOE Window?

Each year, from November 15 to December 15, the ACA opens a one-month Special Open Enrollment (SOE) Window for Small Group medical plans. During this time, employers can provide group medical insurance to their employees without adhering to the standard contribution or participation minimums. Any group coverage secured during this window will become effective on January 1, giving employees the start of the new year with medical coverage in place.

Guaranteed Issue and Waived Requirements

Under the ACA’s guaranteed issue provision, health insurers must accept any eligible small employer or individual who applies for coverage, provided they are within the plan’s service area. However, meeting coverage requirements outside the SOE period can be challenging for many small employers. In states like California, for instance, health carriers typically require a minimum of 50-70% of employees to enroll. On top of this, they often stipulate that employers contribute a set percentage toward the premiums.
The SOE Window helps small businesses circumvent these restrictions, enabling them to provide essential health benefits without the usual participation or contribution conditions. This flexibility is especially beneficial to businesses whose employees may opt out of coverage due to financial reasons or other preferences.

Why Is SOE Important for Small Businesses?

Many small businesses, despite offering reasonable or even generous contributions, encounter obstacles due to the federal ACA Individual Mandate penalty being reduced to $0 in 2019, which lessened the incentive for employees to secure health coverage. While California introduced its own individual mandate in 2020 to encourage residents to obtain insurance, financial constraints or lack of interest may still impact participation rates. The SOE Window gives these employers an additional option to enroll their workforce, reducing the likelihood of coverage being denied due to unmet requirements.

Important Deadlines and Guidelines

While the SOE period allows for waived participation and contribution requirements, it’s crucial to keep in mind that all other underwriting guidelines still apply. Deadlines are tight, so it’s essential to work closely with your benefits provider to meet all submission requirements within the SOE Window.
Our team at CorpStrat is here to guide you through this special enrollment period and provide you with resources tailored to help your small business benefit fully from this opportunity. If you’re interested in learning more about how SOE can work for you, or if you have any questions, please don’t hesitate to reach out!