Answers and Explanations

1. The agent said to get Plan F so you don’t have to pay anything.

A. E&S’s You have to pay a higher premium for Plan F compared to Plan G. Depending on your state, the Plan G may be a better value so you will pay less compared to Plan F.

2. The Council of Aging people told me that this national organization’s Medicare supplement was better, so I should go with that one.

A. E&S’s Bless their hearts, but unfortunately the CoA volunteers have made plenty of gaffs. This is another one. The benefits for the Medicare supplement plans are standardized. If the CoA volunteers are recommending a large, name brand Medicare supplement that is more expensive than a smaller company’s plan, aren’t they actually doing a disservice for their audience? Click here for another example of one of their gaffs.

3. My neighbor said that this (Brand X) is a good one.

A. E&S’s It’s good based on what? This is invariably based on opinions that are based on feelings.

4. Do they pay?

A. E&S’s They all pay! Any thinking or suggestions that any given company doesn’t pay is flat out wrong.

5. I’ve never heard of that company (Brand Y) before (with a worried tone implying that it may not pay).

A. E&S’s It doesn’t make any difference if you have heard of the company or not. They all pay!

6. But, can they drop me?

A. E&S’s As long as you pay your premium the company cannot drop you, no matter how many claims you have had. Every Medicare supplement policy says this in its policy language.

7. That company is only in a dozen states (fearing that the company is too small and may not pay its claims).

A. E&S’s They all pay their claims. They also pay claims in all 50 states, even if they do not write business in any given state. Additionally, the smaller companies tend to have stronger financials compared to the larger ones.

8. They treated me really good.

A. E&S’s I’ve heard this one a lot! The company did not single you out to “treat” you well after they paid a claim of yours. They simply performed their end of the bargain… You pay your premium, and they pay your claims if and when they occur. It’s simply a business obligation on their part.

9. My husband has this one, so I might as well get the same one.

A. E&S’s What if your husband has an overpriced plan? Do you want to repeat that error and overpay again?

10. I’ll call an 800 number because I want to cut out the middle man.

A. E&S’s I heard this one from a gentleman that was misled by the Council on Aging. There is no “middle man”. The rates are all filed with the state insurance department, and it makes no difference whatsoever, as far as the premium goes, if you purchase your plan from an agent or through a company’s 800 number. When you sign up via an 800 number, you pay a commission to an agent that you will undoubtedly never see. In addition, you usually pay more than you need to, because the 800 number order takers aren’t looking out for your best interests. They don’t explain to you other lower cost options.

11. They paid really good. (Someone says this after a big claim was paid.)

A. E&S’s This is the same as number eight.

12. I don’t want to change.

A. E&S’s This is a fairly common sentiment. It basically boils down to this: The devil I know is better than the one I don’t know. Knowledge of the Ten Mistakes, especially number one and two, can help overcome this fear. A new, lower cost company will pay its claims just as well as your old company.

13. I want to get the most for the least.

B. K&U Usually these people want to listen to the facts and get the best buy. They understand the basis for going with a particular plan. They quickly grasp recommendations to help them get the best buys. They tend to be less swayed by hype.

14. I don’t care about a more competitive price; I just want to make sure they pay.

A. E&S’s Again, this statement is based on the fear that a particular company may not pay its claims.

15. My plan covers everything that Medicare doesn’t cover.

A. E&S’s No plan covers non-Medicare covered expenses. It’s correct to say the following: My Plan F covers both deductibles and the co-insurances not covered by Medicare. This is true with any Plan F.

16. I’ll go through all of this (meaning the stuff in the mail), and when I figure it out, I’ll call you.

A. E&S’s This is more of a brush-off. This person won’t figure everything out because relying on what comes in the mail is like playing poker or pinochle with nine cards missing from the deck.

17. I don’t want to have to pay any deductibles or copays.

A. E&S’s See number one. A higher premium for Plan F in many cases incurs more out-of-pocket costs compared to Plan G. People, and agents, conveniently forget that your premium is also an out-of-pocket cost. Now, if you say that you are perfectly willing to pay, let’s say $280 to buy $140 (in 2012) benefit, then you could argue that this is K&U.

18. We have our other insurance with them.

A. E&S’s Do you buy every stitch of clothing you own from the same department store?

19. I’ve been with them for a long time, so I don’t want to change.

A. E&S’s This is the same as number twelve.

20. I trust the Council on Aging folks.

A. E&S’s And that trust is based on what? They do have a minimal training session, but the CoA folks are not licensed. They take no required insurance continuing education courses. They go through no annual re-certification for Medicare Part C or Part D plans as agents are required to do.

21. I like the one I have.

A. E&S’s This one is real common. People tend to like what they own. For example, most owners like their car. This common sentiment also crosses over to intangibles such as insurance products. Now, do you like paying $0.50 to $1.00 more per gallon for gasoline than you need to? Probably not. So why do people persist in paying more for a Medicare supplement than they need to? I believe that it comes back to the fear of change or fear that another company won’t pay. For others it’s a pride thing. People don’t want to admit to themselves that they made a bad buy.

22. I know I don’t understand all of this, so I want you (an insurance professional) to help me.

B. K&U These people know their limitations, and they know they need help. It’s also been my experience that these types of people are some of the best and easiest ones to work with. The only caution I have for these folks is they don’t allow themselves to get led astray by a bad agent.

Rate yourself

20-22 correct: Excellent

18-19 correct: Good

16-17 correct: Average

14-15 correct: Poor

0-13 correct: Try again


Doing well on this quiz doesn’t necessarily guarantee that your knowledge and understanding will predominate over your emotions and sentiments. However, the better that you understand the differences between these two decision-making processes, the more likely it is that you will be more of a K&U shopper than an E&S’s shopper.

Avoid the Three Major Mistakes!