In an ideal world, people/employers should just be able to do it themselves and cut out the middleman.
This would not have happened if the person selling you the insurance was under a legal (read: license) obligation to provide you the most appropriate insurance.
I could see how even an old-school agent could forget to mention earthquake insurance for home insurance or lack of acupuncture in health plan.
And many, many, many more. By comparison, advising on health insurance actually kinda makes sense.
California licensee lookup: http://www2.dca.ca.gov/pls/wllpub/wllquery$.startup
A bad hairdresser can slice off my ear and a bad cook can poison me.
In finance, it's incredibly easy to make a living by acting in bad faith. You can offer insurance with no serious intention to pay out, and tie up claims in bureaucracy and legal loopholes.
Good regulation should go some way to minimising bad faith actors.
In fact the industry seems quite scammy anyway. But it would be much, much more scammy - to a criminal extent - with no regulation at all.
Both of which require licensing.
In an ideal world everyone would do the right thing, in the real world some level of bureaucracy and regulation is a necessity.
When the vast majority of customers can't tell (even after years) whether they've been had, that creates an unusually strong argument for having someone else check whether the seller is being honest, such as a licensing authority.
(Which is an argument for mandatory auditing, not for licensing. Yes.)
If I flip your concern around, why do you think it would be appropriate for someone to sell me a health insurance plan without any understanding of what the different plans offer or which plan best served my needs?
If I'm buying insurance, I expect the salesperson to be able to understand my situation, what I'm looking for, and tell me all my available options, and the benefits/drawbacks of each.
Licensing makes sure the salesperson goes through the efforts to get to this point.
If so, it sounds like insurance salespeople are similar to tax or financial advisors, and regulation forces them to read through and familiarize themselves with all of the options. Fair enough. Just wish the system itself was revamped, pricing schemes simplified, and information made more accessible, to make even this unnecessary.
One mans bug is another mans profit. So that's not happening.
I signed up with Covered California a few months back and while they provided basic facts and a comparison matrix of plans, they didn't go out of their way to make sure it would fit my needs just perfectly. With nothing but a Web site and a wizard, how would they?
It's a legal mechanism that stops insurance companies selling people policies that don't actually cover them for what they need. Essentially it shifts the understanding of what insurance is required from the buyer to the insurer. It's harder to refuse a pay out if your salesperson has to make sure all the necessary boxes are ticked.
Well, reading what Zenefits was doing, and how badly they screwed up might enlighten you.