Generally, the premium of an Individual Health Insurance Policy is quite high as compared to a group insurance policy or the employee health plan. The facilities given by the Individual Health Insurance Policies may not be as comprehensive as the Group Health Insurance Policy.
How is the premium calculated?
The premium would be based on certain factors like age and medical history along of the individual .The insurance companies would also enquire about pre-existing conditions and certain habits like alcohol or smoking. Individuals who are suffer from certain illness, are old or are habituated to alcohol or tobacco, are termed as high risk and would be required to pay a higher premium.
What should I consider before I go for an Individual Health Insurance Policy?
The insurance policy has the right to deny a policy to an individual based on certain factors like age; the individual is suffering from some chronic disease, etc. But once you have the policy, it is mandatory for the insurance company to renew your policy.
The policy may contain an "exclusionary rider", meaning, in case you suffer from a particular disease mentioned in the exclusionary rider, the insurance company is not liable to pay.
Following points should be borne in mind before going in for an individual health policy:
Go for a non-cancellable and a guaranteed renewable policy. This will bind the insurance company to renew your policy. With this clause, the company can not cancel or deny renewal of your policy.
The insurance companies generally grant ten days time to finally decide whether he is interested in buying the policy.
Read the policy carefully to understand what the policy includes and what does it exclude.
Types of Individual Health Insurance Policies
There are two primary options available in the individual health plans: HMOs and PPOs.
The HMOs has their own physicians who would decide the future course of action for the insured. The insured is not free to consult any other doctor, other than the HMO.
Unlike HMO, PPO allows the insured to choose a doctor who is not a member of the PPO. However, in such cases, the payout from the insurance company would be very low.
The HMOs and PPOs offer unlimited service. In addition to the HMO or PPO, an individual should also opt for the Health Savings Account. The savings kept in this account is tax free. This would ensure that an individual has funds to pay for the deductibles in case of need.
Before buying an Individual Health Insurance Policy, one should compare it with the family Health care Insurance Policy. It is better to insure the entire family, as the medical care in the US is really very prohibitive.