What to do When Your Health Insurance Coverage is Ending

Life Insurance Can be a Creative Problem Solver

Life insurance has traditionally been used to pay for the care of a loved one in the event of your untimely death, but increasingly it’s being used in other, more creative ways.

There are two basic scenarios in which you would require life insurance in retirement. First, you don’t have enough money to cover your final expenses, and you don’t want to burden your family. So, you purchase a small life insurance policy to cover these expenses.

Second, you have dependents – usually a spouse and/or children – who would not have sufficient income to live comfortably after you die. So, you purchase a larger life insurance policy to support your loved ones until they can provide for themselves (or for life, depending on the circumstances.)

Creative Uses for Life Insurance

Beyond these basic intents, however, life insurance can provide a creative solution to other problems that may crop up.

For example, in this scenario, you have a considerable estate, and don’t want to leave your heirs with the burden of paying estate taxes. But there’s a simple solution: You could set up a life insurance policy to pay the estate tax.

A buy-sell agreeement for a business you are involved in.

Key Man life insurance for an employee.

Charitable Giving.

Funding a trust.

Your advisor is well-equipped to explain the differences between permanent and term life insurance, and to recommend which is best for you based on your individual circumstances.

What to do When Your Health Coverage is Ending

As if anything to do with insurance isn’t hard enough to understand, things like healthcare billing certainly make it so. Policyholders commonly experience “balanced billing,” and getting one from a hospital ER, for example, might not be anything like you’d expect.

Common health insurance policy types – HMO and PPO plans – work within specific networks of healthcare providers to provide lower premiums. Unfortunately, even when visiting an in-network hospital, the doctor or surgeon who treated you may not be part of the same network.

After visiting a hospital, clinic, or any medical facility operating outside of your health insurance network, you may receive a bill for the difference owed after your health insurance has paid its share of the medical provider’s invoice.

For example, if you have a visit to a hospital emergency room (ER), you might receive a bill that looks a bit like this:

The hospital charges your insurance carrier $500 for an ER visit. The insurance pays $250. You don’t pay anything additional because the hospital is in a network contract with your insurance provider. You’re only responsible for co-insurance and co-pay amounts less your deductible.

A treating doctor also charges $500 for your ER visit. Insurance pays $250. Because the treating doctor hasn’t a contract with your insurance provider, you’re responsible for the additional $250.

To avoid “balanced billing”, ask your insurance agent which healthcare providers are in your policy’s provider network, so you can go to network providers wherever possible.

If you need health insurance, don’t feel as though you can buy coverage only through the government’s website or any of the third parties soliciting consumers. The insurance agent you have always worked with (and who is familiar with your individual situation) can answer your questions about healthcare reform and help you compare coverage. You also can purchase a plan through him or her.