California health
insurance
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Understand
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Avoid Bad Health Plans
How to Avoid A Bad Insurance Policy
Most California insurance companies treat
their customers in a professional, courteous
manner, solving problems and paying claims in a
timely manner.
However,
there are unfortunately always exceptions to the
rule.
How can you keep yourself from being taken
advantage of, or worse, being left
unprotected when you need the coverage the most?
What happens after you actually purchase the
health insurance plan and find yourself in a
position where you have major health issues?
That's when it really counts.
Here are a few things to keep in mind when
choosing your policy.
If it sounds too good to be true, it probably
is.
Adequate health coverage costs money, and
medical expenses continue inexorably to rise. Be
wary of brochures or insurance agents who claim
all kinds of coverage for very little money.
They may be marketing a low premium, but what
that sometimes means is that you will have to
bear disastrously higher out-of-pocket expenses
in a major medical event than you would from a
reliable, traditional carrier.
For example: an insuree thought he had gotten
a good deal on an insurance policy, but
then found out, after being admitted to a
hospital following a heart attack, that the
policy only paid $100 a day toward his hospital
room expenses--when the hospital room charge was
a $10,000 a day.
Guess who had to make up the difference?
Some second tier carriers will come into the
market with very low rates and when the claims
come in 3-5 years later, they pull out of the
market or raise the rates significantly. If your
health has changed, you may be unable to a
better carrier or plan.
Read the fine print.
The policy should spell out what's covered
and what's not.
Generally this covers normal medical
expenses. Hospitalization would be covered;
cosmetic plastic surgery might not be.
If you see something you don't understand, or
which looks suspicious, ask about it. It may
save you a lot of grief and
financial hardship in the long run.
Watch out for caps
Be careful for caps on hospital care or other
services. Some plans on the market have caps on
the hospital care of $600 (or other amounts).
You might as well not have health coverage at
all since hospital bills can be 10's of thousand
if not 100's of thousands of dollar. Some plans
on the market are starting to cap brand name
medication which can also be very dangerous.
The trend going forward is towards very
targeted and very expensive medication for
conditions that are more exotic. Some of the new
(and very successful medications) on the market
are 10's of thousands of dollars per year.
Having a $1000 brand name cap will not do much
for you or your family.
Enquire about the company's rating
Legitimate insurance carriers are usually
rated by by AM Best. A strong carrier will
usually be rated A or at least a B Plus. If a
company will not provide its rating, or the
rating is a B or lower, it might be wise to shop
someplace else.
Check the National Association of Insurance
Commisssioners (NAIC) for guidance. You can find
them on the Internet. They assign numbers to
legitimate insurance carriers. IF the NAIC
hasn't heard of a company, or the carrier
doesn't provide this information, find another
insurance company. You can also check with your
State's Department of Insurance for more
information on carriers, complaints, and plans
available on the market.
Check out the California health agent
Most state departments of insurance lists
complaints on their web sites against agents.
By the way, we have ZERO complaints in over
15 years of history.
If an agent has many complaints, he or
she is not the right person for you. You can
also check on the status of the agent's license.
Is it current? Has it been withdrawn for any
reason?
Has she or he met his training requirements?
All agents should display their license
information in correspondence. You can find our
information at our About Us page.
"Bait and switch."
Rates will increase based on the cost of
doing business even for legitimate carriers, but
sometimes questionable carriers will "lowball"
rates to generate new business. Then the rates
go up sharply after someone has been on the
policy for a relatively short period of time. .
Also, by law a carrier has to increase the
premium rates for a whole group, not on
an individual basis. Check to see when the
carrier last raised its rates. If there have
been multiple rate increases over a year's
period, you might want to look further.
Call us at 800-320-6269 with any
questions. Our services are free to you as
licensed health agents.