Choosing appropriate health coverage is not a rosy affair, and healthcare reform has made the situation even worse. But here are 10 perennial tips that will help you pick the policy that will best meet your needs.
1. Analyze Your Needs in Advance and Plan Accordingly
The best health insurance policy is the one that is tailor-made to suit your specific needs. So, before anything else, start by clearly identifying your needs before you look for a policy.
Figure out, for instance, what family members you intend to cover. Also be sure to identify relevant factors that might influence the kind of coverage you need: are they elderly, are they suffering from a terminal illness, do you plan to start a family?
Narrow down your specific short- and long-term needs. That way, you'll know when you've found a policy that meets them—and when you've found one that doesn't.
2. Settle on an Affordable Insurance Company
Note that there is a difference between affordable and cheap. Affordable coverage is adequate and won't stretch your budget; a cheap policy will save you a lot of money but might not protect you when you need it to.
One way to keep your plan within your budget is by paying attention to the type of company you're buying from. General and life insurance companies both sell health insurance, but financial experts have deduced that it's much less expensive to buy it from a general insurance company. Consult licensed insurance agents before making this choice (see Insurance Agents: What's the Point? to learn more about agents and what they can do for you).
3. Ask About Different Types of Health Insurance
Understanding each and every health insurance policy available is key to settling on the appropriate one. It's okay to ask as many questions as possible to fully understand them. Different families have different policy needs, so make sure you get all the relevant details before purchasing.
4. Identify Recognized Partners
Each individual insurance company has their own network of recognized service providers. This is a group of doctors, laboratories, hospitals, and other healthcare providers that have partnered with the insurer. If you receive care from an out-of-network provider, you may need to pay most or all of the medical bill.
Make sure your preferred choice of healthcare providers are among the approved providers. If you don't have any preferences, consider the providers' specialties in terms of your family needs and proximity to your home in case of an emergency.
5. Prioritize the Sum Assured
In simple terms, "sum assured" refers to the maximum amount of cash that the insurer may reimburse or make available for medical coverage to a policyholder in a single policy year.
Make this choice carefully, and keep in mind the rising cost of medical care. But don't take this to mean that you should choose a very high sum assured—that would mean paying a very high premium. Choose, instead, a policy with premiums you can pay comfortably without any complications.
6. Beware of Freebies
Most up-and-coming insurance companies come onto the market with numerous free offers to lure in new clients. Be very careful not to fall for commons trap. These offers are often not even free, since you end up paying for them in other ways. Don't pick a policy just because of the freebies; instead, look at the policy as a whole.
If you still want to go with one of these companies, you should conduct extensive research and background checks on them to make sure they are trustworthy. Try, if you can, to interact with their existing customers and speak with the company agents (see How to Choose an Insurance Company That Won't Go Out of Business for more advice on choosing a reputable company).
7. Read Reviews and Compare Policies
Every company will do what it can to put its best foot forward, but you will want to know about all the negatives before you decide to sign up for one of their policies. The best way to do that is by reading online reviews. Learning about the experience of their customers will help you identify companies that come through in emergencies and provide their clients with a high degree of satisfaction.
Comparing policies within a company and between various companies is also a good way of feeling out the market. A good policy package from one company might look slim or pricey when held up against the one offered by a competitor.
8. Explore all the Clauses in Detail
Take time to read through each and every clause in the insurance policy and make sure you understand all of them. If you struggle to understand any of them, ask for clarifications.
One of the most important clauses is the renewability clause. Some companies state in this clause that the policy expires once the insured reaches a specified age. This could leave you without health insurance when you probably need it most. Health insurance will be valuable at any age, so it's sensible to choose a policy that offers coverage for a lifetime.
Pay special attention to clauses regarding pre-existing conditions, such as diabetes. Most policies state that, for anyone with those conditions, the policy will only be active after a stipulated period of time.
Also read through the maternity clause. Most companies leave maternity costs out of their policies, so it's worth considering whether you will need them covered or not.
9. Assess the Flexibility of the Policy
Always go for a policy that will let you continue paying the old premium amount for some time after an illness before requiring any re-adjustments. Also opt for one that doesn't add interest or other charges on the increased premium.
10. Check for a No-Claim Bonus or Discount Offer
Some companies encourage their customers to keep fit and healthy by offering incentives. They usually include a discount on the next year’s premium or a bonus following unclaimed insurance in a policy year. Look for these sorts of offers when considering a health insurance policy.