Debunking 4 Common Misconceptions About Supplemental Insurance for Consumers
By: Franklin Madison
Following the pandemic, individuals are increasingly seeking various ways to protect themselves financially in times of need. One avenue that is gaining popularity with consumers is supplemental insurance.
However, amidst the growing interest, consumers still have misconceptions surrounding this type of insurance that often deter them from understanding its true value—or stop them from purchasing altogether.
In this blog, we will debunk four common misconceptions your consumers may have about supplemental insurance and identify ways your financial institution can address them directly.
Misconception 1: “I Already Have Enough Coverage from My Primary Insurance.”
One of the most common misconceptions consumers have about supplemental insurance is that it is redundant, considering they already have coverage from their primary health or life insurance policies.
However, this belief fails to recognize the unique benefits that supplemental insurance can provide. Unlike primary insurance, which may only cover specific medical expenses or provide a fixed sum in the event of an unfortunate incident, supplemental insurance complements the existing coverage by filling the gaps that may be left behind.
For example, a person undergoing treatment for a critical illness may have substantial expenses not fully covered by their primary insurance. Supplemental insurance can step in and provide additional financial support for expenses such as travel and accommodation during treatment or other expenses. When marketing supplemental insurance, clarifying this misconception with clear marketing messaging can emphasize how supplemental insurance serves as an extra layer of coverage, ensuring comprehensive coverage and peace of mind.
Misconception 2: “Supplemental Insurance is Expensive and Not Worth the Cost.”
Another misconception that often hinders consumers from considering supplemental insurance is the perception that it is an unnecessary expense.
It is important for financial institutions to communicate the various options available and highlight the potential long-term savings and benefits of enrolling in supplemental insurance.
The key to dispelling this myth lies in educating consumers about the potential financial burden they might face in the absence of adequate coverage.
A well-crafted marketing message can emphasize how a relatively small premium for supplemental insurance can help safeguard them from unexpected expenses.
Comparing the cost of supplemental insurance to the potential financial ramifications of being underinsured can be a persuasive approach to demonstrate its value.
Misconception 3: “Supplemental Insurance is Only for Seniors or Unhealthy Individuals.”
Many consumers believe supplemental insurance is designed exclusively for seniors or those with pre-existing health conditions. This misconception stems from a lack of awareness about the diverse range of supplemental insurance products available in the market today.
When marketing supplemental insurance, it’s important to highlight the inclusive nature of supplemental insurance, catering to people of all ages and health statuses. From hospital accident insurance that covers hospitalization after covered injuries to recuperative care insurance that helps with costs associated with recuperating after a covered accident or injury, supplemental insurance plans are tailored to suit various needs and lifestyles.
It’s not just group accident and sickness coverage, either. Financial institutions offering pet insurance can help consumers take care of the animals they love with fewer surprise vet care costs, and products like cyber insurance can serve a large portion of consumers in an age when people have devices for just about everything they do.
By clarifying the misconception that supplemental insurance isn’t meant for the young and healthy, financial institutions can position supplemental insurance and other insurance products as versatile and valuable financial wellness tools.
Misconception 4: “Filing Claims for Supplemental Insurance is Complicated and Time-Consuming.”
A common deterrent for consumers when considering supplemental insurance is the misconception that filing claims and receiving benefits can be a cumbersome process.
As their trusted financial institution, you can help them assuage this fear by working with an administrator that provides consumers with a seamless and simple registration, account management, and claims experience. With a digital-first approach, consumers can handle many of their account management on their own, but they should also be able to speak directly to expert customer experience representatives who can guide them through when they need additional support.
Supplemental insurance marketing messages should emphasize the ease of claims processing backed by efficient customer support. Sharing testimonials or case studies of satisfied customers who have had positive claim experiences can instill confidence in potential buyers. By addressing this misconception, financial institutions can showcase their commitment to customer satisfaction, making supplemental insurance an attractive choice for those seeking hassle-free protection.
A Robust Insurance Product Suite for Improved Revenue
Supplemental insurance is a valuable financial product that offers significant benefits to consumers seeking coverage and peace of mind. Financial institutions can play an important role in educating consumers about the true value of supplemental insurance. By debunking common misconceptions, financial institutions can better serve their consumers and protect their financial wellness.
Working with an expert insurance marketing and administration company like Franklin Madison allows institutions to empower consumers to make well-informed decisions, securing their financial well-being in times of need and earning loyalty in the process. As consumers become more aware of the unique benefits and affordability of supplemental insurance, they can embrace it as a vital tool in their journey toward achieving financial security and peace of mind—and you can be the financial institution that helped them get there.