eBay delays insurance program

The leading auction site says a program for some key members of its community has been delayed. Analysts call the delay "disappointing."

2 min read
eBay has delayed the launch of a health insurance plan targeted at key members of its community: people who make their living by selling goods on the auction site.

Announced in June and set to debut in October, the program now has been pushed back to January, eBay said in a message to "PowerSellers" on its Web site. PowerSellers are among those who sell at least $1,000 in goods on the site each month. eBay has called the group critical to its success.

"eBay PowerSellers are composed of individuals and businesses scattered throughout the country, and thus, are not a traditional group as defined by healthcare providers," eBay said. "As a result, we have entered into complex negotiations with providers to create plans that meet our intended goal of allowing you to access low-cost, premium healthcare coverage. Our work will continue through the fall and we will be ready to start taking applications for enrollment in January."

eBay representatives could not be reached for comment to elaborate.

In June, the company unveiled its health insurance plans at the eBay Live conference in Anaheim, Calif. The event was held to build a loyal community of buyers and sellers.

eBay previously had said it struck a deal with Physicians Mutual Insurance to provide the service. Physicians Mutual representatives did not return calls seeking comment.

In a research note on Thursday, financial analysts Thomas Underwood and Scott Devitt of Legg Mason called the delay "disappointing."

"In this environment of high insurance premiums for self-insured individuals and small business owners, it is imperative that a solution be provided so that the PowerSeller community can continue to thrive," the analysts wrote. "It is not eBay's responsibility to solve the problem, but it is in eBay's best interest to roll out an affordable, well-managed health insurance program for its small business base."

But at least one PowerSeller took the delay in stride. Bob Miller, who sells stamps and postcards on eBay, said that the company may have made the right decision. eBay has in the past been forced to revise or drop initiatives after sharp criticism from users.

"If the reason for the delay was that the plan that they were going to roll out was inadequate, it was a good thing," Miller said. "It's better to be late and right, than to be early and pathetic."