Investors

Is it possible to build an economically viable business that provides expert one-on-one advice to consumers who must navigate through the complex maze of health insurance?

That was the key question in the formation of Freedom Benefits Association in 1997. This consideration will be just as important in the evolution of our business today through the post-reform era that effectively begins in January 2014. When we originally launched the FreedomBenefits.com fifteen years ago (for individual insurance, the Web site is not currently in operation) and later FreedomBenefits.org (for small business flexible benefit plans, the Web site is not currently in operation) from a small 4 person office in Narberth Pennsylvania, there were other few online services operating in this field. Growth was certain. The main obstacle at that time was skepticism of the security of online financial transactions. Our MedSave.com Web site because the 4th or 5th largest provider of online health insurance before being sold in 2008.

Since the passage of federal health reform law this field has become crowded with government-owned as well as commercial insurance exchange Web sites. Recently even Wellmark and an Blue Cross franchise announced a deal to purchase and develop a national insurance exchange. Certainly the market for online health insurance enrollment has grown along with the number of providers. We re-launched our current service at FreedomBenefits.net to after the details of the PPACA law became public to take advantage of the potential for integration of government and commercial online insurance options.

Yet the one factor that has not changed in all these years is the strong demand for caring, personal and knowledgeable advice. Health insurance is a major financial purchase for every consumer that holds a place closer to the heart than any other. The consumer experience is packed with a high level of emotion and often inaccurate preconceptions about the product which means that only highly skilled personal adviser can lead to a sound decision. We know that health insurance is absolutely crucial for personal wealth because of its important location right at the junction of health and finances - two of the three pillars of personal wealth and happiness. For more than twenty years and various online platforms and forums (Financial-planning.com, AdvisorMax.com, Wealthmanagement.us.com) I have preached the importance of making health insurance the cornerstone of personal financial planning. Yet few professional attorneys, accountants or advisers handled health insurance issues. Finally the financial planning and wealth management industries seem to agree and health insurance planning is no longer viewed as distasteful part of professional advisory services. Even a growing number of CPA firms now include health insurance risks in their personal financial planning analysis and recommendations.

Through the OnlineAdviser service platform (OnlineAdviser.org) , we have helped more than 50,000 individuals on a one-on-one basis over the past decade. The rate will likely accelerate after 2014 if current law is implemented. We anticipate greater disparity in the needs of health insurance (and related advisory services) based on personal financial status in coming years. This is a controversial subject that will add new challenges for the entire advisory field.

FreedomBenefits.net insurance exchange has two tangible competitive strengths. First, we are licensed in every state and the district of Columbia. Few competitors can make this claim. Second, we our own in-house non-insurance services for small business health plans including flexible benefit plans and cafeteria benefit plans along with the practical help in getting the plan started. Few, if any, other providers are able to link the insurance with the benefit plan documents to the setup on the company's accounting system. The in-house arrangement gives us a cost advantage in the small business market.

Our largest business challenges are: 1) moving our service to a mobile phone platform (most online insurance still requires a desktop for enrollment, 2) conversion from a commission-based to a contract fee-based compensation model (through OnlineNavigator.org), and 3) competition from Ehealth, our largest competitor. Secondary challenges are related to technology and our-sourcing within the industry. Clearly our ability to succeed is equivalent to our ability to adopt to change. Yet I remain confident that the future demand for our services place Freedom Benefits directly in the middle of one of the fastest-growing industries of this generation.

We recognize that our future growth, like other technology-based firms, will most likely come from new soures and technologies not visible today. For that reason, we welcome confidential inquiries from potential partners or investors.

Tony Novak, MBA, MT
Founder, Freedom Benefits Association

"Freedom Benefits", "OnlineAdviser" and "OnlineNavigator" are trademarks of Freedom Benefits Association.