Wal-Mart enters health insurance business

The mega-chain plans to expand its one-stop offerings to the health insurance business, dispensing plans and advice to shoppers.

Insurance News

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Just six months after introducing auto insurance to its ever-expanding wheelhouse, monolithic retailer Wal-Mart is taking another step into the insurance game: offering health insurance at 2,700 of its 4,000 stores nationwide.

The retailer won’t be selling health insurance, per se, but a partnership with online insurance comparison site DirectHealth.com will allow shoppers to compare coverage options and get detailed insurance advice online, by phone or in person starting Oct. 10.

“For years, our customers have told us that there is too much complexity when it comes to understanding their health insurance options. We saw a need to bring more transparency and simplicity,” said Labeed Diab, senior vice president and president of Wal-Mart’s health and wellness division. “The more we can broaden the assortment, the more we can educate our customer, the better off we will be.”

DirectHealth.com will offer access to more than 1,700 plans from 12 carriers for consumers over 65, including plans from leading insurers like Aetna, Cigna and Humana, from Oct. 15 through Dec. 7. For customers under 65, DirectHealth.com offers plans from more than 300 carriers to be sold from Nov. 15 to Feb. 15.

The supermarket chain will also be testing 11 healthcare clinics run by Wal-Mart, offering health screenings and other preventative care.

While Wal-Mart won’t receive any commissions on the health coverage sales, it represents just one more threat to the independent insurance agent distribution channel with regard to healthcare reform.  With independent insurance agents from DirectHealth.com on hand in stores, Wal-Mart will be able to offer qualified advice to a demographic of Americans who still represent some of the greatest opportunities in the individual health insurance market—typically local, low-income residents and minorities.

The move also represents yet another expansion by Wal-Mart into the insurance business. In April, a partnership between the store and AutoInsurance.com allowed shoppers to find and purchase car insurance policies online.

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