To paraphrase the fast food commercials - Where's The Beef? In other words, what has happened to all the premium money collected by the insurance companies? We know that the cost of dental insurance, the premium, has gone up over fifteen times since 1970, but the annual maximum benefit has not gone up from the $1000 a year it was in 1970. Moreover, people are astounded to learn that the annual maximum of $1000 has not gone up for most insurance companies in over twenty-six years. So, where has the money gone?
A study by Dr. James Bramsow and Marge Feldman revealed some rather interesting information. Dental insurance plans pay out, in benefits, from as little as 59% of the total premiums collected. And, they have profits, sales and administrative expenses as high as 41%.
The next time your dental insurance doesn't want to cover a procedure, ask them what they have been doing with all your premium dollars for the last 26 years.