Mike Majors: Yes. I think while there may have been some that have pulled back, I mean, overall, we are seeing movement into Medicare Advantage plans. And in this line of business, there’s big carriers or small carriers. The cost of entry is low, because it’s not a capital-intensive business. So, I couldn’t speak to which are particularly pulling back or not. But overall, there is a move on the group side and individual side, Medicare Advantage plans. I think the current economic environment contribute to that. I would assume that people are more willing now to give up the benefits of a Medicare supplement plan that doesn’t have provider network or referral requirements to go to a cheaper managed care. And as Matt said, we’ve been in this business since Medicare started in the ’60s.
We’ve seen these swings back and forth over the years. So, it’s not really unusual or surprising. We’re going to maintain that distant approach. That said, it’s to protect our margins. It’s also to protect our customers. We want to avoid having higher than necessary renewal rate increases. We’ve never been the lowest cost provider here. We think that’s fair to the customer to have the right price and have reasonable rate increases. And the other thing to remember is that price of this business — the price we have in our new business is the same as our renewals. So, it’s not like we can go in and have lower new business prices because if we were to do that, that would impact the profitability of our in-force block, which is the United American around $500 million.
So, again, it’s something that we’ve seen before and again, not particularly surprising.
Andrew Kligerman: And just to kind of a little further clarification on this, so you’re seeing the competition across agencies and online. And is there any interest in terms of kind of transitioning to more Medicare Advantage products as opposed MedSup?
Mike Majors: I’m sorry. There was a lot of background noise. Could you repeat that?
Andrew Kligerman: Absolutely. So, in terms of distribution competitors, is it pretty much across agency and online? And then, with that, is Globe likely to pivot more to Med Advantage as opposed to historically being in the MedSub area?
Mike Majors: Matt, do you want to take that or you want…
Matt Darden: Sure.
Mike Majors: Okay.
Matt Darden: Let me start. I’ll say we don’t have plans to pivot into the Medicare Advantage area. I think the competition is coming from all pass. We do have a little bit of our sales that are online as well. So, we do see the competition in the pricing, in the agency and online channels. A bulk of our sales are in the agency business. So, Mike, do you want to add to that?
Mike Majors: Sure. I think the Medicare Advantage, we don’t use networks for one and that would be something that — that’d be a big change for us. And it’s just — it’s not a line of business that we’ve been in, and I know we considered a long time ago. At one time, we were in the Part D plan, which is similar, and we exited that. And it’s something that we wouldn’t want to do. It’s really, I think, harder for smaller players to do that and to get involved with the Medicare Advantage and Part D. I don’t think that undertaking would make sense for us.
Andrew Kligerman: Seems like a thoughtful approach as usual.
Operator: Does that answer your question, Mr. Kligerman?
Andrew Kligerman: Absolutely. Thank you.
Operator: Thank you very much, sir. We’ll now take a question from Mr. Mark Hughes calling from Truist. Please go ahead, sir.
