I’ll admit it…I didn’t understand the AFLAC duck right away. Oh, I clearly recognized the duck to be the face of AFLAC insurance, but I didn’t really understand why someone would buy hospitalization insurance if, like me, they had a good comprehensive medical plan? I had the same question about critical illness and accident insurance: wasn’t that what my health plan was for? I assumed that my standard health plan would cover all of my needs in the event of an accident or illness, and that these types of insurance were completely redundant. After all, it felt like they were being advertised as “health” insurance, and so I would ignore them.
It wasn’t until I understood these types of ancillary insurance to be income replacement/gap-filling insurance that I finally got it. They’re designed to help cover the related, but not direct medical expenses one could encounter in the event of an accident or major health diagnosis – for example, child care coverage while undergoing treatment, unpaid time off work to undergo rehab, etc. Typically, health insurance doesn’t cover those items and yet those costs could be a big drain on our financial resources if an accident or significant illness happened to us.
I wonder how many other people out there are like me? When it comes to selecting benefits or coverage for the upcoming year, how many other consumers ignore certain types of coverage because the purpose is not clear – or worse, is misunderstood?
It is far more helpful to consumers to put insurance and other benefits in the context of what the particular plan is actually designed to do for them. For example, does it help them maintain their current spending power if something unexpected happens? Does it help protect their family financially if they die? Does it help them maximize their income and spending power by taking advantage of pre-tax or other discount programs?
Many of the ancillary and voluntary benefits available to individuals and employees are designed to help reduce financial exposure in very specific ways. It is much easier for us to make wise, effective decisions about what we need when the options are laid out in a way that helps us understand how each type of coverage will help us achieve a given objective. It’s clear there’s a much more consumer-friendly way to help consumers make the right choices to achieve health and financial security, and using a memorable mascot is just scratching the surface.