Medigap Insurance Companies
About 25% of seniors with Medicare decide to take out a Medigap supplement insurance plan. One of the biggest questions these senior citizens face is deciding on an insurance provider.
The benefit of one company over another is subjective and each applicant should weigh the pros and cons of any insurer. After learning the basics about Medigap companies on this page, consumers can evaluate them side by side on our compare page. We also provide a quoting tool which shows a comprehensive list of a variety of insurance providers in your area.
The Market for Medigap Companies
The baby boom generation is growing at a staggering rate. For the next 15 years, the AARP predicts that 8,000 people per day will turn 65, further increasing the need for Medicare coverage.
Despite the large age group, very few insurers have entered the growing Medigap insurance market. Ten insurance companies are responsible for two-thirds of the current Medigap policies. According to the U.S. Department of Health and Human Services, the top 10 Medigap companies/groups and their market shares are as follows:
- UnitedHealth Group — 31%
- Mutual of Omaha Group — 10.7%
- Wellpoint Inc. Group — 6.1%
- Health Care Services Corp. Group — 5%
- CNO Financial Group — 3.6%
- BCBS of MI Group — 2.3%
- Highmark Group — 2%
- Wellmark Inc. Group — 1.8%
- BCBS of MA Group — 1.8%
- BCBS of FL Group — 1.7%
The Medigap marketplace is even more competitive at the state level. In nearly all states, the top two statewide Medigap insurers account for more than half of the market in each state.
Stock and Mutual Insurance Companies
There are two types of Medicare supplement companies, stock insurance companies and mutual insurance companies. Each company type can offer varying benefits for consumers.
UnitedHealth is a stock company that focuses on maximizing its short-term profits while offering a large industry presence and a wide array of benefits. Mutual of Omaha is a mutual insurance company that does not involve itself with Wall Street and focuses more on long-term growth. Stock insurance companies usually have greater financial flexibility than mutual insurance companies which can help secure its future, but mutual companies can offer greater competitive prices for their consumers.
Both company types are suitable insurers. Each of the aforementioned insurance companies have proven their stability in the insurance industry. When consumers decide which company type to choose, the decision should be aligned with their unique healthcare and financial goals. Company ratings from A.M. Best, Fitch Ratings, or Standard & Poor’s can assist Medicare beneficiaries make these important decisions.