Advice on Shopping for Personal Health Insurance

Everyone knows how to shop for a home, car or other major purchases, but most people don’t know how to go about shopping for individual/family coverage. Many of you are leaving group insurance and have never owned an individual policy. Individual policies are different than group policies and you really need to understand how individual policies work and how to shop for them.

When shopping for insurance you may have several agents contact you, or you may feel comfortable dealing with just one agent. In either case, here are questions you’ll need to know the answers to before applying for any policy.

Common Questions and Answers

Do you offer “major medical” policies?

Always make sure you purchase a major medical policy. If you need an affordable policy ask your agent to raise the plan deductible or look into a Health Savings Account.

What is the out-of-pocket max?

This could very well be the single most important question to ask. The out-of-pocket max is simply the amount you would be responsible for before the plan pays 100%. You should never purchase a plan that does not have a set out-of-pocket max.

What is the co-insurance?

The co-insurance is the percentage of the bill your are responsible for. If you have 80/20 co-insurance you would be responsible for 20% of the bill until you reach your out-of-pocket max.

What is the deductible?

This is the amount each person would be responsible for before the policy pays. Deductibles work differently for each policy. Ask if the deductible needs to be met for office visits and prescription drugs.

If I had a $60,000 surgery what would I owe?

This should be a simple question for any agent to answer. It’s the deductible plus the out-of-pocket max. If any agent ever fails to answer this question or says “the odds of you having a surgery that large are…..” then simply continue to shop.

Is there a processing or application fee?

All companies charge some type of application fee. Find out how much the fee is before you sign up.

Do I need money down?

Most companies can process your application without any money down. Not putting money down is the best way to apply for insurance. If for some reason you are declined you don’t have to wait 4 to 6 weeks to get a refund.

Do I have to join an association?

There is a lot of “association” insurance in the country. Always ask if you need to join an association to obtain the health insurance. If you do, ask how much the association dues are and the different levels of membership.

How many policies do you offer?

A lot of agents will offer you a quote on just one policy. However most insurance companies offer at least 3 different policies. Always ask the agent how many policies are available and the major differences between each one.

IMPORTANT TIPS ABOUT SHOPPING FOR A POLICY

  • Never feel pressured by an agent. If an agent is just pressing to meet with you without answering the above questions it’s not a good sign.
  • Always fully disclose your entire health history for the past seven years. If an agent does not know your entire health history they cannot give you an accurate quote.
  • Always review the material before signing. Have the policy details either e-mailed, faxed or mailed to your house. We live in a high-pressured sales world. Health insurance should not be high-pressure.
  • Always run a few scenarios past your agent: If I saw my doctor, had blood work done and got prescribed a drug, how much would I owe? If I had a $60,000 surgery how much would I owe?
  • Never deal with anyone evasive. Also, never deal with anyone who says “it’s too complicated to discuss over the phone.” Policies should not be “complicated.”
  • Be wary of agents who tell you things like life insurance, critical care, or other benefits are “included.” The only thing “included” in a health insurance policy is health insurance. Any other “product” is extra. Find out the cost.

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