Why is it important to understand the implications of the various insurance reforms?

Over the years, the Capital Market, Insurance and Savings Authority has executed various reforms that were supposed to serve the public, but in practice – that wasn't necessarily the result.

In 2012, the guaranteed advance in executive insurance policies was cancelled, and currently you can only join plans without a guaranteed advance.

However, in reality, the real guaranteed advance hasn't been operational since June, 2001, so for those of you with pension plans from before June 2001, it's advisable not to touch them. As for plans after 2003, you can consult with a licensed pension advisor to explore whether there is room to transfer the funds to a different plan with lower management fees.

Until December 2013, it was possible to receive financial compensation from the insurance company for choosing to undergo a procedure in the public healthcare system and not using private health insurance. For those with health insurance policies prior to December 2013, it is probably advisable to keep the policy, due to its relatively low price and the option to choose a non-listed surgeon (there is a certain deductible in these cases).

February 2016 - Comprehensive reform in the private healthcare sector. It is no longer possible to choose a non-listed surgeon except for a few small insurance companies such as Ayalon, Hachshara, and direct insurance policies. Policy terms are renewed every two years, and insurance companies can increase prices by up to 20% every two years without regulatory approval (this was recently canceled, and now they can increase pricing even more). The reform allowed the purchase of modular health insurance, which means that almost every coverage could be purchased separately. This option allows you to purchase a new drugs component that includes coverage for genomic tests costing around 50,000 shekels to upgrade old policies. Prohibition on purchasing with a fixed premium (more expensive but cost-effective in the long run). Policies became significantly more expensive due to the reform.

August 2017 - Change in disability (loss of working capacity) insurance policy terms (due to an increase in premiums). For those of you with existing disability (loss of working capacity) policies, it is advisable to keep them if you are not transitioning to a pension fund. The reform prohibited the purchase of duplicate coverage in disability insurance. Those who already purchased additional coverage for disability could reach 100% coverage in the early years (instead of 75%). Many insurance companies decided not to continue selling disability (loss of working capacity) insurance due to the reform. Prohibition on the sale of fixed premium (more expensive but cost-effective in the long run). Insurance companies almost completely reset the commissions received by insurance agents for this product due to this reform.

November 2017 - Group health insurance sales were suspended through most organizations. Those who paid until the suspension and refused to pay a higher fixed premium lost their insurance coverage despite paying for many years.

Important and valuable tip! If someone in the family (including parents/grandparents) is a member of a large organization like IDF veterans or the aerospace industry, check out the feasibility of joining a group health insurance or supplementary insurance through them.

February 2019 - Changes in life insurance led to increases and decreases. I recommend comparing old policies the premium distribution to new offers, and not immediately switch to plans with discounts for just a couple of years. This was the first and most brutal intervention is in the commission model of insurance agents, which serves as a scapegoat for the Capital Market, Insurance, and Savings Authority.

April 2019 - Marketing of default pension funds began, allowing enrollment in coverage for relative coverage and disability coverage without a health declaration (with a 5-year qualification period) and a significant reduction in management fees in pension funds and employee benefits insurance.

October 2019 - Discontinuation of private supplementary insurance sales due to the withdrawal of secondary insurers and the supervisor's refusal to approve the sale of policies with higher premiums. Today, it is possible to purchase only group supplementary insurance through health funds or a limited number of entities such as IDF veterans' organization. Insurance agents lost a vital product they have been selling for many years.

May 2021 – changes in the personal accident insurance policies, which were a downgrade in my opinion. This was a product with a fixed premium that wasn't dependent on a claim, which has now become a less favorable product without compensation for occupational disability cases.

Insurance companies have almost completely reset the commissions that insurance agents received for this product due to this reform.

May 2023 (postponed to December 15, 2023) - A new health insurance reform that will not allow upgrading/multiplying insurance for medications along with group insurance. A reform that will change existing components of the surgery appendix, including converting old policies into supplementary policies, which will burden the public healthcare system. The cancellation of discounts in the early years will result in price increases for the entire population.

The reform is likely to lead to the cancellation of commissions for insurance agents in this field, which will push many insurance agents who will not be able to transition to a remuneration model outside the industry, as has happened in the past in England and Australia.