I’VE WRITTEN BEFORE about stumbling on an unexpected way to save on auto insurance. My education continues: I’ve also learned of a way to save on Medigap coverage.
When I became eligible five years ago for Medicare, I bought Medigap Plan G supplemental coverage from Mutual of Omaha (MOO). Last summer, as my wife was about to become eligible for Medicare, we took another look at Medigap coverage. I was generally happy with MOO’s claims procedures and customer service, as well as the fact that MOO would extend a 12% “household discount” if we also got my wife’s policy from MOO. But I didn’t like the fact that my own premiums had gone from an initial $97 a month to $148.02, an increase of almost 53%.
One day, I received a mailer from Omaha Supplemental Insurance Co., a MOO company, which quoted a $115.18 monthly premium for a 69-year-old male nonsmoker, my status at the time. Although my policy was with a different MOO company, United World Life Insurance, I couldn’t understand the significant price difference.
I contacted the insurance broker who had helped me with my original Medigap application, and asked if I could simply switch MOO subsidiaries and benefit from the lower rate. She replied that the lower quote was for “new business” and, since I was already a MOO customer, I didn’t qualify.
My broker was retiring, so I found a new broker who seemed very knowledgeable and I repeated my question to him. To my surprise, he said that I would indeed be considered “new business” if I applied to a different MOO subsidiary. I next contacted Mutual of Omaha directly and a representative confirmed the good news.
Since I was applying for a new Medigap policy outside the initial open enrollment period—the period when I first became eligible for Medicare at age 65—I’d have to pass medical underwriting. Fortunately, I’m in good health and, after answering a few questions on a form, I was accepted.
My wife’s quoted rates were the same at both my original MOO company and at the new one: $96.41 a month. And my new broker, since he was writing me a new policy, received a well-deserved commission. As for me, going from $148.02 to $115.18 a month is saving me $394.08 a year.
While I’ll be on the receiving end of premium increases going forward, starting from this new lower base means I should keep saving every year. After a few years, if my premiums again get uncomfortably high, I’ll start researching whether there’s yet another MOO subsidiary that would be happy to consider me “new business.”
