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Well, we are to the end of 2003. At Bates & Associates, we have had a challenging but rewarding year. In the health insurance arena we witnessed again strong renewal increases for many, due to the continuing challenge of escalating drug prices and new and expensive means of treating patient’s needs. That aside, we also recognize that the United States has the best health care delivery system in the world today. The challenge however, is how to afford such a delivery system. That is why one of our founding principles at Bates & Associates is to always be willing and available to market our client’s health programs upon request, assuring the best pricing possible for them.

On the commercial side the economy still struggled in 2003 from the recession, causing insurance company investments to continue to under achieve. Knowing that investments represent an insurance company’s greatest source of corporate profits, one then realizes that when that element of income isn’t performing, then premiums to insureds must increase. At B & A, we carry our marketing philosophy on the benefit side over to our commercial endeavors. W e are constantly seeking better ways to save client dollars through proactive representation.

2004 suggests some improvement in both areas. This year brought signs of competition from the four major health carriers in Minnesota. Medica, who Mary deals with in this newsletter, took the first steps to become more competitive. They offered a one time savings to insureds and pledged to have lower increases than normal in 2004. Blue Cross and Blue Shield began an active ad campaign touting health care advocacy for insureds and programs designed to save health care dollars. If these steps continue, all of the major HMO’s will be competing for a larger share of the pie which means there could be improvement financially for the insured companies in the coming year.

On the commercial side, 2004 also shows signs of trending toward improvement. This recovery will not be quick, but pricing should stabilize for many insureds as investments begin to improve. At the writing of this article the DJIA is at 10,248 a significant improvement over last year at this time. Future investment profits will help lower your commercial insurance cost over time.

We here at Bates & Associates, would like to wish you all a happy and prosperous New Year, and we look forward to working with you in what we feel will be an improving 2004.

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