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Non-Tech : pamc -- Ignore unavailable to you. Want to Upgrade?

To: Parnell who wrote (147)	12/18/1998 8:07:00 AM
From: Steven M. Kaplan	Read Replies (2) \| Respond to of 570

Don't know about the paper version chances, but here's another article I found: Article on Web-Finance: HealthAxis.com Eyes Market For On-Line Health Insurance HealthAxis.com,the electronic commerce affiliate of Provident American launched one year ago, was created to target consumers who want to buy health care insurance -- at a discount -- via the Internet. The company recently raised $5.75 million to use as working capital; investors included America Online,with which HealthAxis.com has a marketing deal. HealthAxis.com's mission is to represent a broad array of health insurance carriers, said Craig Gitlitz, director of finance and communications. "We're not at all allegient to Provident," he said. "We started with them because they're our parent. We know we have to deliver choice to consumers." America Online invested $2.75 million in HealthAxis.com, and received Series B convertible preferred shares, according to a recent Securities & Exchange Commission filing. A spokesman for AOL said that over the past year, it's become increasingly common for AOL to take an equity stake in the companies that it has marketing deals with. HealthAxis.com is the only financial services firm in which AOL has taken a stake to date, but financial services firms represent just a small portion of the companies AOL does business with, the spokesman said. AOL has taken an equity stake in five to ten companies over the last few months, the spokesman said. Meanwhile, Lynx Private Equity Partners received newly issued Provident common stock for a $3 million investment that Provident then invested in HealthAxis.com. The investments follow one made by a company in an insurance- related business that bought a convertible debt security worth $5 million in May, according to Gitlitz, who declined to identify the company. That debt security was converted into common stock in HealthAxis.com at the end of September, he said. HealthAxis.com's aim is to pass along a portion of the savings resulting from eliminating the agent, Gitlitz said, adding that agents typically receive 20% of insurance premiums in commissions. HealthAxis.com plans to pass half of that amount onto the consumer, while HealthAxis.com and the carrier will share the remaining portion. To spotlight its lower costs, the company's Web site prominently features the slogan: "Save With Web-Direct Health Insurance." Provident American sells its products through independent agents,Gitlitz said. Asked whether the company is concerned that the new e-commerce affiliate might antagonize those agents, Gitlitz said, "We think we can coexist with the agent." That's because some consumers don't use the Internet, and would need an agent to access health insurance, he said. To market its service, HealthAxis.com has inked marketing pacts with three Internet portal sites: AOL, Lycos and Cnet, Gitlitz said. Under these deals, only HealthAxis.com can advertise the types of insurance that it provides on those portals. The three arrangements are "multimillion dollar deals" where HealthAxis.com will pay additional fees for each policy sold through leads generated by the portals, Gitlitz said. The deal with AOL is for three years, the arrangement with Lycos is for two years, and the deal with Cnet is for 18 months, Gitlitz said. HealthAxis.com allows consumers to obtain quotes and buy insurance on-line. Claims can also be followed up on-line, Gitlitz said. The company also has a customer call center that is open 14 hours a day, and customers can also contact customer service via e-mail, Gitlitz said. HealthAxis.com currently sells individual health insurance. The company also plans to sell small group health, dental, vision, prescription, long-term care, critical care and disability insurance. Currently, the only carriers the company represents are Provident American and Fortis Health. Gary Craft, an analyst with BancBoston Robertson Stephens, said HealthAxis is "a significant player" and is following the right business model in aiming to offer consumers an array of carriers from which to choose. Craft said HealthAxis.com would need on the order of 50 participating carriers to be successful. George Moriarty and Mary Schroeder