Mistakes to Avoid When Buying Health Insurance

Life Insurance IS Possible with health issues

Your health affects your ability to obtain life insurance, and the rate you’ll pay for it (in some cases increasing your premium by as much as 100 percent), but that doesn’t mean you need to worry if you’ve battled a serious illness; you may be able to get reasonable coverage anyway.

According to the Life and Health Insurance Foundation for Education (LIFE), 2-4 percent of life insurance applications are rejected annually. That said, many people with pre-existing medical conditions whose applications have been approved will pay higher premiums.

What medical conditions should concern you?

You’re unlikely to get insurance with HIV/AIDS, and there are health conditions that could increase the price you’ll pay. The top five are: cardiovascular problems (such as a recent heart attack, bypass surgery, or valve surgery), stroke (even a mini-stroke), diabetes, cancer, and Hepatitis C.

While conditions such as these will likely increase your premium, it may only be for a period of time. Active cancers, for example, may lead to a denial of coverage. However, insurers may consider offering coverage – perhaps even at standard rates, and especially for some types of breast and prostate cancer – after two to five years of remission.

Insurance companies have different underwriting preferences: If you suffer from pre-existing medical conditions and want life insurance, you should talk to your insurance agent. He or she will be able to advise you on what to do if your application is turned down. Insurance companies have different underwriting preferences, so even though one may reject your application,
another one may accept it.

Your agent may contact an impaired risk specialist on your behalf. This specialized agent can make inquiries of other insurance companies at no cost to you.

You’ll only need to proceed with a formal application and medical exam if the impaired risk specialist indicates the situation looks promising.

Mistakes to Avoid When Buying Health Insurance

Whether it’s a personal policy or affordable family health insurance you seek, there’s no question about it: Shopping for health insurance can be difficult. You probably know what to look for, but here are some things you should avoid when buying health insurance.

Spur-of-the-moment purchases

With hundreds of different insurers offering different products at different rates, don’t sign on the dotted line until you check with your current insurer. You could shop around to see what’s available, but chances are your insurance professional – who knows your personal situation well – is better able to find the right health insurance policy to meet your needs.

Choosing unfamiliar dot-coms

Obtaining insurance online is tempting; but you don’t know them…and they don’t know you. It’s easy to make promises online – and many dot-com companies do just that – but can they keep them?

One of the most common promises is: “We – Company X – can give you the lowest rates from insurance provider, Company Y.” Don’t be misled into thinking this is a thorough quote comparison; the policy’s cost will likely be the same. You need to be presented with options and/or ways to cut your rates. By buying online you miss the chance to negotiate.

Researching online can help you learn what’s available, but buying online limits your options.

Getting “low-balled”

Good things don’t always come in small packages, especially when it comes to health insurance policies. Just because a rate looks good doesn’t mean you’re scoring a deal: Read the fine print. Too many people can miss important points such as who your in-network providers will be or what your deductible is. Read everything carefully and ask questions – it’s smart, and it’s your right.

Finally, if you’re unsure about the policy you need, discuss your situation with your insurance professional. He or she will give you the straight goods, unlike many of the other guys.