Over the years that OCI has been working with producers, we have always striven to be as open and honest as is possible. We have never asked the producers to pay for the services we provide and only ask one thing in return. We ask that producers be fair to us and run all of their business through OCI so that we are able to show the carriers that we provide valuable services to them. Over the past few months, it has been brought to my attention that there are numerous cases that producers have business direct with carriers. This is concerning to me as it either means that the producer doesn’t trust OCI or that they are not being honest with us. If you happen to be one of those producers who have business direct or through another entity, I would appreciate some insight as to why. OCI can only continue to provide the services we do if we are able to work with carriers and show substantial volume of business. If the carriers end up having to do a lot of the work OCI provides, their overall cost of distribution is higher. Think of it in this manner. An account representative may be able to handle 40 – 50 producers. If each carrier has to have numerous account representatives, the cost is substantially higher than if OCI can handle those producers and find the right solution for the client from the carriers that we represent. We can eliminate the carriers excessive overhead especially because we only get compensated if business is actually written.
If OCI is not able to garner all business from a producer, it may be necessary to implement a monthly fee to all producers. It wouldn’t have to be huge amount, maybe around the $20 – 25 range and for some producers it may seem like a better option. I personally don’t like the thought of this but the other option would be to cut some of the services and that is, in my opinion, an even worse solution. The individual rater costs a lot to maintain and keep current. The electronic group application is another example of an ongoing expense that OCI feels assists the producer and I would hate to see lost. OCI has over the last year really tried to lower overall operating expenses because of changes that are happening in the health insurance industry. But now we have to decide how to continue. I would truly appreciate some insight from the producer community.
So, in closing, if you have business direct with a carrier I ask that you transfer it to OCI. If you don’t want to transfer, please be honest with me and let me know why. If you have strong feelings as to an implementation of a monthly fee, please give me a call or email and let’s discuss. Again, I have always been up front with producers and this is a time that we at OCI could really use your help. Thanks for all you do.