Early one morning I was awakened by a call from one of the major banks. The very pleasant, young woman on the other end of the line introduced herself as an Insurance Representative from the bank and said she was making a special offer to me because I was a preferred customer. I liked that, even if I didn't believe it. I allowed her to go on. She went on, describing the special offer (an insurance plan called: Hospital Cash which would provide me with a certain amount of cash per day should I ever be confined to the hospital) and how I (a preferred customer) could go about applying for it.
At that point I politely revealed to her that I was an Insurance Broker, and therefore quite familiar with the product. I pointed out that the appearance of this product a number of years ago conveniently coincided with the marked decrease in the average number of days a patient might be expected to stay in hospital (due to the pressure on hospitals by our health care system to get patients out of the hospital bed as soon as possible); that this product was, in fact, a cash cow for the insurance and banking industries and any card-carrying club they were marketing it through; and finally, that unless any client of mine could get it for free, or was otherwise uninsurable and the plan was being offered with no questions asked, I would never advise any client of mine to participate in such a scheme. I didn't stop there. I also said that, even under the aforementioned circumstances, my hypothetical client should be very wary of the fine print disallowing any claim for pre-existing conditions.
Again, politely (I make it a point always to be polite), I asked the young woman what she thought about what I had just said. She replied: "Well, I really don't know about all that stuff; I just make the calls." So I asked if she had any opinion about it, and she said: "No... not really."
What it all boils down to is this: I am "not really" afraid of the banks being in the insurance business. But I'm afraid you should be!
Even though the young woman was representing one of those billion dollar profit banks, the deal she was offing was not much different from that which might be offered by any organization or club that you might belong to. The insurance company sells a package to the organization, club - or bank - which they in turn sell to their members, employees or customers.
The trouble is, in all these instances, you have no real control over future benefits, cost or even the continued existence of the plan. Furthermore, if your relationship with the organization, club - or bank - should change for any reason (and the times they are a-changin'), your eligibility - your protection - could be adversely affected. In other words, if you do not have a contract guaranteeing the future of your participation in a plan, other than some third party arrangement, then I strongly advise you not to bet on Maggie's farm being there for you when you need it.
