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Comment by run4yourlives2 | Hacker News Reader

At the centre of this scandal is a company selling insurance with unlicensed brokers.

That means people advising others on what insurance to buy where their health is concerned who didn't know what the hell they were doing.

The software made to skirt the licencing requirements is only a subset of the overall issue.

Frankly, I'm getting a little tired with the group of commentators on here that think its a-ok for a company like zenefits to tell people "Sure, you're covered for that in this policy" when they frankly have no idea if that is the case.

Selling insurance advice without a license is exactly like selling financial services advice without a license. And both actions are illegal for very good reasons.

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I worked with mortgage brokers for a while. They had a big exam, all complicated and they were supposed to be able to advise.

What they actually did was put 5 figures into a computer and pick the mortgage nearish the top with the biggest commission.

I have no idea how complicated health insurance is in the US as I'm from the UK but I'm willing to bet £100 that's what 90% of health insurer brokers do too.

>I have no idea how complicated health insurance is in the US

Exactly.

Your comment just drips with enlightening anecdotes and interesting exposition explaining how picking health insurance is so much more complicated than all the other financial advice that today is basically little more than:

Put client's answers in brokerage program

Choose highest commission in top 10

Recommend product

1. Mortgage brokerages are not financial advice brokerages. A mortgage broker finds the best deal for the consumer, usually for products that are more or less the same.

2. A financial planner or investment advisory is about helping a client gauge what product works best for their particular situation, and being able to communicate the very real downsides of certain courses of action.

3. An insurance broker acts in a very similar way to #2, in that there are some very real concerns that may not be obvious to the layperson that the broker should be providing advice on. For example: what a health insurance product covers, and why (for example) not providing coverage for children in your female dominated company could result in very real losses to your employees, and by extension, you as a company.

>Put client's answers in brokerage program; Choose highest commission in top 10; Recommend product

..is PRECISELY the type of thing that licensing is designed to protect the consumer from.

Group health insurance is extremely complex, particularly in the US where it is really the ONLY health insurance a person has. These are people's lives we're talking about here...you can't wait until you HAVE cancer to find out that your plan doesn't cover it.

The only thing this entire thread is showing is exactly why not having licensed, knowledgeable professionals advising on insurance is a very real concern.

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