When it comes to saving and spending, one thing that just about everyone would like to spend less on is health insurance.
If we aren’t fortunate enough to have someone else taking care of our medical insurance premiums or medical care costs in general, we are likely familiar with the annual sting of rising health insurance premiums. You are not helpless though!
There are steps that can be taken to lower premiums if the numbers simply aren’t adding up for you. Here, we highlight some of the major factors that can alter your health insurance costs so that you can know what to address the next time you renew your policy.
Low costs = low benefits
The first thing to mention is that, when it comes to buying health insurance, you should try to avoid falling into the low cost trap.
Some people start their search for insurance by hunting down the lowest cost plans available on the market; however, even if you are budget-focused, taking this approach is likely doing yourself a disservice.
This is because the old adage that ‘you get what you pay for’ is perhaps exemplified nowhere better than the insurance industry. Be sure to dive into the details of any plan that has an amazing price to make sure that the benefits it provides are going to be sufficient for your needs.
Otherwise, you may find that the plan won’t really take care of you or a family member when you need it most.
Now, there are some things that you cannot change when it comes to what you pay for health insurance. A factor like age will be taken into account by insurance underwriters, but we obviously can’t reverse time to lower our healthcare costs.
Nor can we control how many people in our family there are that we need to insure. If we want to cut our premiums, it isn’t as simple as not providing insurance for little Timmy.
However, there are factors that we can change in order to affect our premiums. Let’s have a look at some.
Deductibles and excesses
These terms refer to an amount that must be paid by the insured each annum before any claims can be made on a health insurance policy.
The higher this amount is, the lower your premiums will be, as your insurer knows that you will be covering more of your own medical costs each year.
For instance, there are plans available with no deductible at all, but a plan with a $1,000 deductible will have lower premiums. The real decision for you is if you think the cost of the deductible or excess is worth the savings you will see if you go through the year without needing to make an insurance claim.
Benefits and pre-existing conditions
What does it cover? This is the question that should be in the forefront of people’s minds when they are shopping for health insurance. If you look at your current health insurance costs and think that they need to be lower, you may be able to simply alter the benefits your policy provides.
Cutting out maternity coverage, dental coverage, or coverage for specific costly conditions that you are not at risk for could lead to lowered premiums.
The other side of the benefits covered by your policy are pre-existing conditions. Many health insurance policies exclude pre-existing conditions – meaning conditions that were present prior to when a policy was obtained – outright.
However, there are insurance companies that will provide coverage for pre-existing conditions as long as they take them into account during the underwriting process. This will undoubtedly lead to higher premiums, though, as risks and costs rise quite a bit when pre-existing conditions are included in coverage.
An easily adjustable figure that every health insurance plan comes with is an annual maximum benefit limit. This is the total maximum amount of benefits that an insurance policy will pay out in a given year.
Many plans with a figure that is well beyond what the average person will require in a year, even if they may have a somewhat serious short term illness or injury. With these plans, it will take an especially costly catastrophic incident, or an expensive chronic condition to max out the benefit.
Of course, if you are willing to risk affordable coverage for these types of ailments you can lower the maximum level of benefits on your plan.
This will lower premiums, but any costs beyond the limit will have to be addressed out of pocket.
About Pacific Prime – Since 2000, Pacific Prime Insurance Brokers have provided the best in international health insurance plans and customer service to people all over the world.
Headquartered in Hong Kong with offices throughout Asia and the Middle East, Pacific Prime offers free plan comparisons and price quotes to all, which has resulted in them having over 120,000 members globally.