Health
Insurance
An individual health insurance plan covers one person, or
members of a family, on one plan. Self-employed people, those
who work at a company that does not offer (group) health
insurance to their employees may need health coverage on an
individual basis. Although health insurance can be expensive and
difficult to obtain (that is where we come in), it can be some
of the smartest money you ever spend. An unexpected illness or
serious injury can ruin a family financially if they do not have
some type of coverage.
The
primary disadvantage to an individual health policy is the need
to fill out extensive medical questions about health history.
Because insurance carriers cannot spread the risk among many
employees, your rates are determined by your health history and
current medical condition. Based on the information you provide,
an insurance company can put restrictions or limitations on
pre-existing conditions, or deny coverage all together.
Premiums for individual health insurance can vary quite a bit.
For those who are healthy and receive a good underwriting
review, their premiums can actually be lower than what they may
have been paying for a group policy. While this is certainly
good news, it is important to understand that there are
significant differences between a group plan and an individual
plan. Here are a few of the more important differences;
- Group plans tend to have richer benefits (better coverage)
than individual plans.
- Group plans have certain benefits that are mandated by the
state (maternity, being a good example), that may not be
included in individual policies.
- Most importantly, the lifetime maximum benefit (how much the
insurance company will pay toward medical care in your lifetime)
is usually limited to between $1 million and $5 million. A good
group plan will have an unlimited lifetime benefit (no limit as
to how much the insurance company will pay).
Insurance companies offer the same basic types of managed
healthcare plans to individuals that are offered to groups and
generally offer different levels of deductible to keep premiums
within budget. One of the silver linings to come out of the
spiraling healthcare costs in recent years has been the increase
in the number of options available to individuals who are in the
market for individual health insurance. Each person or family
must determine what coverage, premium, deductible and out of
pocket expense will best suit their needs and their family
budget. (That is where we come in, again.) Just
contact us and
we will be happy to answer any questions you have.
