Case study

We decided to write about how, in real life, helping a client obtain the most suitable health insurance policy actually happens. Find a shortened list of steps here.

A year ago we were approached by a company engaged in wholesale food distribution. They had received a recommendation from another of our clients. They have 40 employees and their existing health policy had been renewed every year with one insurance company.

The policies were not bad, however several employees had complained that when receiving medical services they first had to pay from their own private funds and then submit receipts to the insurer. The insurer in turn, often reimbursed half or even less of the amount that had actually been paid.

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First meeting & goals

We suggested meeting with the HR manager and the chief accountant. We went to their office, got acquainted, and discussed more broadly how things had gone for them with the existing policy and what employees had said about it.

It turned out that no one had really asked employees:

how they liked the existing policies,
what they would like to include in them,
or what kinds of difficulties they encountered when using them.

In individual cases, when someone had some confusion or dissatisfaction, they had gone to the HR manager and complained, but how often and about what no one had tracked.

Together we came to the conclusion that although the policies were purchased precisely to promote employee well-being, they very likely were not achieving this goal, or at least it was not being measured.

The company management was somewhat afraid to ask employees because they predicted that there would be negative feedback and that all employees would want to include services in the policy that would significantly increase the price of the next policy.

Then we proposed the following plan:

Submit the existing policies to us so that we can determine precisely what is included in them and to what extent.
Submit an authorization allowing us to request the claims statistics of the policy from the current insurance company (how many employees have used the policy at all, which services are used more, which medical institutions are visited more often, and how much the insurer has paid out in claims overall). The employer had not heard about such a possibility at all and was very interested in seeing how much value there actually is in the policy that is purchased every year.
After becoming familiar with the terms of the existing policy, we at Perks insurance brokers would prepare an electronic questionnaire through which we could ask all employees: how they like the current policies; what could be better; what services they would like to include additionally; which services they could give up; and whether there have been any problems and what they were.
Then, based on the results of the questionnaire, the conditions of the existing policy, and the employer’s perspective, prepare a market overview of the possibilities offered by each insurer specifically for this company.

They agreed and were very happy that finally someone would approach this issue with such care. They also acknowledged that they themselves would not have to spend time speaking with several insurance company representatives in a specialized language that is difficult to understand, or trying to make a decision without missing or misunderstanding something. They said it is stressful and time-consuming work. Such recognition made us very happy.

Evaluating current policies & needs

After examining the terms of the existing policies, we concluded that they had several shortcomings.

2. Dentistry, which was included in the policy as an additional program, was also limited by a price list.

For several years now, insurers have offered a dentistry additional program without a price list. This makes it possible to avoid situations where the program supposedly reimburses 50% of the dentist's service price, but the specific price listed in the price list is lower and in the end, 50% becomes 26% of what the employee actually paid.

For example, a tooth is repaired for 80 EUR. The price list shows such a service as 50 EUR. The employee pays 80 EUR and expects 40 EUR from the insurer, but the insurer reimburses 50% of the amount stated in the price list, namely 25 EUR. Which is about 31%.

Of course the employee has not studied the terms and does not understand why such an amount is reimbursed, and this does not promote trust in the policy.

3. In the outpatient rehabilitation additional program, there are restrictions: a single-visit limit of 10 EUR.

This means that for each massage, the insurer will reimburse up to 10 EUR regardless of how much the massage actually costs. Although the total limit of the additional program is 120 EUR, if the employee only needs two massages then the maximum reimbursement is 20 EUR.

This restriction can easily be removed so that the entire 120 EUR can be spent even on a single massage session. This significantly changes the reimbursement received by the employee, because on average a massage costs about 50 EUR.

The most interesting thing is that on the insurer’s side, this only changes the price by a couple of euros and this limit is easy to remove.

In the claims statistics it was visible that:

Only 30 employees out of 40 had used the policy.
The most frequently used services were doctor consultations, diagnostics, laboratory tests, and dentistry.
The medical institutions visited most often were Veselības centrs 4, MDF, Gulbja laboratorija, and ARS.

The total level of claims paid under the policy was 64%. This means that the insurance company had paid claims amounting to only 64% of the amount that the client had paid for the policy. In the current market situation, where prices for medical services are steadily increasing, on average across all our clients we see this indicator in the range of 90–120%.

Preparation of the questionnaire

Based on the statistics we prepared an employee questionnaire in which we included relevant questions that would allow us and the employer to better understand employee wishes and what prevents the use of the policy.

1. The price list (a list of services with prices according to which medical services are reimbursed if the employee submits receipts) was very outdated.

It provided reimbursement up to 27 EUR for a doctor consultation, ultrasound up to 25 EUR, CT scan up to 100 EUR, and many other items that no longer correspond to current prices.

Such prices for medical services existed 10 years ago, but not now. As a result, when employees receive reimbursement based on submitted receipts, a substantial difference really does remain on their own shoulders.

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Collecting suitable options on the market

With the HR manager, we discussed the conclusions and decided to prepare two levels of offer comparison options:

one with coverage equivalent to what they had before
and another one level better with content corresponding to current market trends.

We started our work and wrote the specification:

what needs to be included,
which conditions to provide for,
which exclusions not to apply,
which price lists to use.

Additionally, so that insurance companies could provide more advantageous conditions, we indicated that half of all employees work in regions other than Riga. This is an important factor in price calculation because medical institutions outside of Riga have a lower price level. All of this is written so that employees of insurance companies, the risk underwriters, have all the information conveniently available and can quickly prepare an offer according to their appetite.

We submitted our specification to the insurers: Balta, BTA, Compensa, Gjensidige, Compensa Life, Baltijas Apdrošināšanas nams, ERGO, and IF.

Offers from insurance companies

Balta submitted its offer in 13 pages, but it does not include precise program descriptions and full price lists (+9 pages) and terms (+8 pages). Without the terms and precise program descriptions one can read only the names (headings).

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Making the comparison document

Then our comparison work begins.

Over the years we have developed our own comparison templates in which we reflect the most important differences so that the information is organized, because otherwise comparing and making a well-considered decision is not possible. In total we compare about 150 policy elements.

Accordingly, in our templates there are policy elements where in each insurer’s column we write whether it is included or not, and if it is included we also reflect the restrictions. Over the years our templates adapt because we take into account all the questions of our clients and the situations of their employees, and the larger this filter and the policy elements become, the better our templates are refined.

There is also a page which we ourselves call the control panel.

In it, we reflect the large blocks:

the base program and
additional program prices,

Under them, we show the options that can be added for an additional price.

Accountants and managers who think more in terms of budget especially like this page because they do not have to search for details.

However, if something needs to be clarified or examined more deeply, then in our offer one can find the specific page where it is described.

Altogether our comparison is usually 14 pages long, unless the client has shown deeper interest in some non-standard policy elements.

Putting together such a comparison once all insurers have submitted their offers (usually this happens within 5–7 working days) takes a couple of days. It must be taken into account that insurers do not always send exactly what was requested. Often one of the policy elements is missed accidentally or intentionally; it happens. Our task is to notice this so that the offers correspond to the client’s needs and to request the missing information.

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Requesting improvements for the top 3 plans

When we have received the offers and reviewed them, we ask the three most advantageous options for further improvements: discounts, additional coverages, or positions that affect the convenience of using the policies. Doing this every day, we know all the current developments and nuances. We know which insurer is more flexible and ready to put more effort into the competitiveness of its offer.

For company employees themselves, such a process could take several weeks or even months. The result would also most likely not be as good, because the market constantly changes, there are many nuances and terms, and understanding them requires time. Therefore when companies do it on their own a lot of time is spent and the result will not be nearly as good. So why do it themselves? It is better to entrust it to an insurance broker. It costs nothing extra but raises the quality bar for the process and most likely the broker, by promoting competition among insurers, will achieve even better conditions.

When everything is laid out, the offers decoded, and the market possibilities clear, we go to the client with our evaluation to present it, answer unclear questions, and help make a well-considered choice.

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Presenting our recommendation and the result

Our new client was delighted because the price difference between the previous option and the one we recommended with improvements was relatively small.

The improvements in the new programs were impressive: a higher price list and fewer restrictions, which allows the policy to be used much more conveniently.

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When the policies were ready, we also prepared a letter that the HR department could send to all employees. We prepare it in simple language, without unnecessary insurance jargon, written in a way that ordinary employees can understand, so they know what is included in the policy, how to use it, and what to do if there are uncertainties: contact us. Yes, we also do that. We help not only find the most suitable policy, but also support all company employees during the policy period in order to care for and increase their satisfaction with the new policy.

We also offered the HR department to organize a video call in which any employee could join to hear from us about the new policy and receive answers to questions. The client was also very happy about this.

Of course, during the policy period we also prepare all the changes that are necessary when one of the employees has terminated employment or when a new employee has joined the company.

Understanding and Using the Policy in Daily Life

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Free Consultation

If you’re unsure whether your policies still match your company’s growth, a brief conversation could help.
We offer a free consultation for businesses with more than 10 employees.