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Think Metal Gap Products are for Millennials? Think Again.

You may think Metal Gap and Metal Gap 2 products are a good fit for your young clients, the ones who take a few risks and enjoy hitting the slopes and trails on weekends. And, you’re right.

But don’t forget about your older clients.

Enrollment data shows they’re the ones purchasing supplemental benefits for accidents and critical illnesses.[1]

“It’s not what people would expect,” says Dave Keller, Chief Sales and Marketing Officer for IHC Specialty Benefits. “In actuality, we’re selling Metal Gap to people that are a little bit older. Even when you look at the over 60 cohort, there are significant sales.”

What do Metal Gap demographics show?

Based on data for individuals who enrolled in Metal Gap 2 policies issued between September 15, 2015, and November 4, 2015[2]:

Keller says the data took him and his team by surprise, but the trend toward older ages, which was also clear with Metal Gap 1, continued with the sales of Metal Gap 2.

If it’s not a matter of rates, what is attracting this demographic to Metal Gap products?

Keller believes Metal Gap and Metal Gap 2 appeal to older demographics for several reasons. For starters, these individuals are typically more established in their careers and earning too much to qualify for premium tax credits and cost-sharing reductions. As a result, they are purchasing the least coverage they can and supplementing the benefits with a Metal Gap product.

The cost of pairing a bronze plan with a Metal Gap or Metal Gap 2 plan tends to be more favorable than upgrading to a silver plan. For instance, using the example of a 56-year-old, non-smoking male living in Minneapolis, Minn., we find the following[3]:

By comparison, here is what he would spend if he added a Metal Gap 2 Value plan to the bronze plan in the example above[4]:

The man in this example could spend 30 percent more in premium to get a silver plan or just 10 percent more to get Metal Gap 2. With his Metal Gap 2 plan, the lump-sum payments he would receive were he to have a covered accident or be diagnosed with a covered critical illness could be used at his discretion—to cover his deductible, coinsurance or copayment amounts, household expenses, out-of-network care, or even costly medications.

The bottom line

Metal Gap and Metal Gap 2 plans can help give consumers extra financial protection as well as options they may not have with major medical coverage alone.

“People in their 40s, 50s and 60s tend to be more educated healthcare consumers,” Keller says. “They understand the impact of networks. Benefits such as those available through Metal Gap plans may not replace their income or fully fund an out-of-network claim; however, they know that lump-sum payment could help them get a second opinion or pay for expensive drugs.”

Because Metal Gap and Metal Gap 2 plans are guaranteed issue, clients of all ages will be eligible for coverage. And, while your clients will live their lives a bit differently every age, they share a common risk: the unexpected.

Unintentional falls are the leading cause of nonfatal injuries among adults age 25 and older[5]—adults who often struggle to pay for healthcare, even with health insurance and a steady income. Thirty-four percent of adults with high-deductible health insurance plans struggle to pay their deductible.[6]

That’s why Metal Gap products are not only for thrill-seekers and the young. They’re also for the everyday person, at every age.

For Producer Use Only. Not for Solicitation to the Public.

This document is for general informational purposes only. While we have attempted to provide current and accurate information, this information is provided "as is" and we makes no representations or warranties regarding its accuracy or completeness. The information provided should not be construed as legal or tax advice or as a recommendation of any kind. External users should seek professional advice from their own attorneys and tax and benefit plan advisers with respect to their individual circumstances and needs.

Metal Gap and Metal Gap 2

About The IHC Group 
The IHC Group is an organization of insurance carriers and marketing and administrative affiliates that has been providing life, health, disability, medical stop-loss and specialty insurance solutions to groups and individuals for over 30 years. Members of The IHC Group include Independence Holding Company (NYSE:IHC), American Independence Corp. (NASDAQ: AMIC), Standard Security Life Insurance Company of New York, Madison National Life Insurance Company, Inc. and Independence American Insurance Company. Each insurance carrier in The IHC Group has a financial strength rating of A- (Excellent) from A.M. Best Company, Inc., a widely recognized rating agency that rates insurance companies on their relative financial strength and ability to meet policyholder obligations. (An A++ rating from A.M. Best is its highest rating.) Collectively, the companies in The IHC Group provide insurance coverage to more than one million individuals and groups. For more information about The IHC Group, visit www.ihcgroup.com.

About IHC Specialty Benefits, Inc.
IHC Specialty Benefits, doing business as Health eDeals Insurance Solutions is a full-service marketing and distribution company that focuses on small employer, individual and consumer products. Health eDeals markets products through general agents online, telebrokerage, advisor centers, private label and directly to consumers. For more information about Health eDeals visit http://www.HealtheDeals.com.

Copyright © 2015 IHC Specialty Benefits, All rights reserved.

Legal Disclaimers

[1] IHC Specialty Benefits Metal Gap 2 enrollment data for policies issued between September 15, 2015, and November 4, 2015.

[2] Ibid.

[3] Quote on 11/10/2015 for non-smoking male born on 08/26/1959 and living in 55419 ZIP code. https://www.ehealthinsurance.com/ehi/ifp/best-sellers

[4] Quote on 11/10/2015 for non-smoking male born on 08/26/1959 and living in 55419 ZIP code. http://www.healthedeals.com/metal-gap-2

[5] U.S. Centers for Disease Control and Prevention. “National Estimates of the 10 Leading Causes of Nonfatal Injuries Treated in Hospital Emergency Departments, United States – 2013.” http://www.cdc.gov/injury/images/lc-charts/leading_cause_of_nonfatal_injury_2013-a.gif

[6] Pollitz, Karen, et al. “Medical Debt Among People with Health Insurance.” The Henry J. Kaiser Family Foundation. Jan. 7, 2014. http://kff.org/report-section/medical-debt-among-people-with-health-insurance-how-does-medical-debt-become-a-problem-for-people-with-health-insurance/