It is human nature to try to get out of sticky situations by blaming other people for our problems.
Two genuine (and genuinely funny!) excerpts from insurance claims illustrate this point.
When asked how their accidents occurred, one responded, “A cow wandered into my car. I was afterwards informed that the cow was half-witted.” Another claimant said, “The other car collided with mine, without giving any warning of its intentions.”
When it comes to high insurance rates, it is easy to blame insurance companies. Nevertheless, there are things you can do to lower health insurance rates. I will mention two of them below.
First, split policies.
We generally like to have the whole family - parents and children — on the same health insurance policy. But sometimes you can save a lot of money by splitting the family up and putting different members on different policies. For example: A couple in their thirties with two children ages 10 and 12 would pay a monthly premium of $363 on a policy that offered maternity. By putting the father and two kids on a non-maternity plan and leaving the mother on a maternity plan, the total monthly premium would drop to $231. This would give a monthly saving of $132. There are variables involved here, e.g., deductibles and total coverage. And of course you will need insurance cards from two different companies. But the inconvenience would mean $132 extra every month in your pocket. That will add up to $1,584 in a year. That is a significant saving.
Second, choose a high deductible.
More and more, people are looking for a high deductible. That simply means the amount of money the client pays before the insurance starts to cover medical costs. Many people used to ask for a $100 or $250 deductible. We are advising clients to consider a $1,000 deductible. That sounds unreasonably high to many people. Yet the premium savings are so significant that generally the money saved in one year from lower premiums (the higher the deductible the lower the premiums) will more than make up for the higher deductible if a person had to use insurance for hospitalization.
Let us look at this illustration:
If a person goes from a $250 deductible to $1000 deductible, he can save $413 a year. If he does not have any major medical costs in two years, he will save $826, which is nearly enough to pay the $1000 deductible his third year on the plan. During my career overseas I was in the hospital one time in 30 years with Hepatitis. Thus with a deductible of $1000, I would have saved $12,390 over those 30 years. Similar savings would also be available for other members of the family.
Third, shop around for medical insurance by using the services of an insurance broker.
Health insurance brokers represent multiple insurance companies. By using their services you can explore various health plans, saving yourself both time and money.
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