In a tight economy, many people choose to forego some necessities in order to make ends meet. Insurance, unfortunately, is one common necessity that people decide to drop when their budgets get tight. Many justify this decision by citing their good health, or the minimal chance that they’ll need major coverage before their situation improves.
Unfortunately, the need for insurance coverage is anything but predictable. Even if you are in excellent health, accidents, injuries or sudden illnesses could take their toll; if you do not have insurance, or your coverage is insufficient, the impact can be devastating. You could be left with extensive medical bills that you canýt afford, or worse, could be left unable to seek proper medical treatment when you need it. Whether you’re a single professional or have a large family, insurance is one necessity that should not be regarded as optional.
The good news is, even if you have a limited budget to work with, there are options to make insurance more affordable and a better investment. A little bit of research and a few smart decisions could help you obtain comprehensive coverage without a hefty insurance premium.
Shop Around
When it’s time to look for insurance quotes, one of the best steps you can take is to use an insurance broker with relationships with several leading insurers. Your insurance agency can help you evaluate each quote, not only in terms of price but with regard to quality of coverage and whether it’s appropriate for your needs.
Evaluate Your Needs Carefully
There are two common mistakes in choosing insurance coverage: buying too little, and buying too much. Your policy should adequately cover all of your needs, but should eliminate any unnecessary options that don’t suit your situation. If you’re unsure of what you need from your policy, speak with a knowledgeable insurance agent. He or she can help you decide which features are a must, and which are extraneous expenses. This can save you significantly in premiums as well as in future medical expenses.
Be Honest
It can be tempting to “forget” a few details when filling out your insurance application, but the few dollars it saves you in premiums could end up costing you much more down the line. If any errors or omissions are discovered, your premiums could be increased, or worse yet, you could lose your coverage completely. While smokers or people who are overweight may pay slightly higher premiums, it is a far better option than finding yourself uninsured or insufficiently protected. If you are concerned that certain aspects of your profile may lead to higher premiums, speak with your insurance agent. They may be able to recommend specific companies or particular packages that suit your situation without costing a lot more money.
Consider All the Facts
When presented with a series of insurance quotes, it may seem logical to simply choose the least expensive one, but cheaper is not always better. Evaluate the features of each plan in comparison with the premiums. Some plans may offer lower deductibles for slightly higher premiums, saving you more money in the long term. Some policies may be more expensive up front, but could have better features such as smaller copayments, higher coverage limits, or more desirable add ons. If a plan costs less, but leaves you at risk of being unprotected in the event of a medical emergency, chances are it will end up costing you much more than you would save. It can be difficult to compare policies from several different providers, as quotes are rarely identical; the advice of a knowledgeable insurance agent is invaluable in determining which policies offer the best overall value.
Which Insurance Should You Get?
As soon as you start investigating your insurance options, you’ll probably be overwhelmed by a barrage of choices. One of the key choices is which type of insurance you need. There are two main categories of insurance: indemnity and managed care. Indemnity is generally more flexible, allowing you to seek medical coverage from the health care professionals and medical facilities of your choosing. However, this freedom comes at a cost in the form of higher premiums and out of pocket payments.
Managed care plans, on the other hand, generally restrict you to a specific network of health care providers and facilities. You won’t have as much freedom in choosing where or from whom you receive your treatment, but you may have access to benefits such as low (or no) deductibles, smaller copayments, and lower premiums. It’s important to note that managed care plans come in two basic flavors: HMO and PPO. While HMO plans often feature lower copayments, the coverage tends to be more expensive overall, and the guidelines governing the plan are often quite restrictive. PPO plans take more of a blended approach by requiring member providers to agree to a specific fee schedule, regardless of the actual costs of the service you receive, under a PPO plan you would only have to pay deductibles and/or coinsurance based on the negotiated fee.
Which plan is right for you? As with any insurance matter, much depends on your particular situation. You may be fortunate enough to find that your preferred health care providers are in a health plan’s network, allowing you to use the doctor of your choice without paying a higher premium. There are many other factors to consider, though, when choosing between these two health care plans.
Additionally, there are some “blended” alternatives that combine some of the features of both indemnity and managed care plans, giving you a bit more flexibility and increased affordability. If you are trying to determine which type of health care is best for you, speak with a qualified insurance agent who can help you evaluate your situation and help you make an informed decision.
Insurance needs vary greatly from one person to the next. Whether you need extensive coverage for your family, or simply need basic coverage for yourself, making the right choices in choosing your insurance provider can save you money and ensure that you have access to quality health care when you need it. Insurance should not be considered as an “optional necessity” but as a critical part of taking care of yourself and your family.