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5 Mistakes To Avoid While Purchasing Your Health Insurance

Team AckoNov 7, 2024

Health stands as a cornerstone of an individual's life and is important for pursuing aspirations. Despite the inevitability of health setbacks, prompt care and treatment facilitate recovery. However, in today's landscape of soaring medical expenses, financial preparedness is indispensable. Health insurance emerges as a vital safety net, yet many stumble in securing adequate coverage due to common pitfalls during the acquisition process. From overlooking comprehensive coverage to neglecting pre-existing conditions, missteps abound.

Ensuring the right choice demands meticulous consideration of factors such as coverage extent, network providers, and deductibles. By steering clear of these errors and investing in a suitable policy, individuals fortify themselves against unforeseen health challenges, safeguarding not only their well-being but also their pursuit of personal and professional endeavours. In this article, we will focus on how you can avoid those mistakes.

Mistakes

Contents

Importance of health insurance

Health insurance provides financial protection against costly medical expenses and ensures access to essential healthcare services, including preventive care and treatment. Without insurance, individuals risk facing significant financial strain and may forego necessary medical care due to cost concerns. Having health coverage promotes overall well-being by allowing individuals to seek timely medical attention, manage chronic conditions, and address health concerns without fear of financial hardship.

Common mistakes while buying health insurance

#1 Being secretive about medical history

Buying health insurance means that you are securing your financial needs in the time of a medical emergency. For this, your insurer must be aware of your medical history and current health status. If you hide your medical history, you might not receive a medical coverage if you fall ill because of a pre-existing medical issue. However, if you disclose this information to your insurer, there are chances that you might get coverage for a recurring medical issue. Similarly, not disclosing your current medical status would also pose a threat for future claim settlement. Things which you might feel are insignificant, for example smoking, might be a driving factor for other medical conditions like a lung disease.

#2 Not considering own requirements

Nowadays health insurance plans are not standard products. You can choose your insurance coverage to fit your needs and customize it accordingly. Many times, people do not take advantage of this flexibility and end up buying a standard policy. Ideally, one should first note his/her requirements and then search for medical insurance plans that fulfill those requirements. This will be highly beneficial at the time of claim. Due to this, a policyholder will make claims against a relevant situation and the chances of claim rejection reduce.

#3 Buying a policy without taking a look at the exclusions

Exclusions are situations that are not covered by your insurer. Since these situations are already present on the policy, you can decide whether to make a purchase or not. However, most of the times, people only consider the coverage offered by the policy and do not bother to look at the exclusions. Not being aware of the exclusions increases the chances of claim rejection and disappointment in the time of need.

#4 Buying a policy without reading the documents

Similar to exclusions, a medical insurance policy also has a list of terms and conditions that the policyholder needs to abide by. A health insurance policy can prove to be complex in nature if the policyholder is not aware of the terms of his/her insurance company. Always take some time out to understand the text written in your policy document. If you buy health insurance from a digital insurer, the term and conditions might be present on the insurer’s website. You as a policyholder will have easy access to these pages.

#5 Being either under or over insured

Lack of research about the product you are buying can lead to you spending more or less amount of money than required. This can be a nightmare with respect to health insurance plans. If you buy more coverage than you need, you are unnecessarily spending to buy a cover that you may never need. On the other hand, if you are buying less coverage you will be left exposed to financial risks in the time of need. Thus, it is very important that you understand your needs, carry out research to buy the right product, and buy adequate coverage.

Health insurance considerations

Assess your needs

Before purchasing health insurance, evaluate your current and anticipated medical needs. Consider factors such as your age, health status, family medical history, and any ongoing medical conditions. This assessment will help you determine the type and level of coverage you require.

Compare coverage and costs

When looking for insurance, it's important to compare the options and costs provided by different insurance companies. Pay attention to premiums, deductibles, co-payments, and out-of-pocket maximums. Look for a balance between affordable premiums and comprehensive coverage to ensure you receive adequate protection without overspending.

Check network providers

Verify whether your preferred healthcare providers, including doctors, specialists, and hospitals, are included in the insurance plan's network. Out-of-network services may result in higher costs or limited coverage, so ensure that your essential healthcare providers are within the network.

Review prescription drug coverage

If you regularly take prescription medications, review the insurance plan's prescription drug coverage. Check if your medications are covered and if there are any restrictions or requirements, such as prior authorisation or step therapy. Opt for a plan that offers coverage for your necessary medications at an affordable cost.

Consider additional benefits

Some health insurance plans offer additional benefits beyond basic medical coverage, such as wellness programs, maternity care, or mental health services. Assess whether these extra benefits align with your healthcare needs and priorities and factor them into your decision-making process.

Research insurer reputation and customer service

Read reviews, check ratings from independent agencies, and inquire about the insurer's track record for claims processing and customer satisfaction. Choose a reputable insurer with a strong commitment to customer service.

Tips to avoid making mistakes

Getting the right health insurance is crucial for ensuring you have adequate coverage for your medical needs without breaking the bank. Here are some tips that should be considered:

Understand your needs

When considering health needs, take into account age and expected medical expenses for you and your family. Research different types of health insurance plans. Each has its pros and cons, so choose one that aligns with your preferences and budget. Check if your preferred doctors, specialists, and hospitals are included in the plan's network.

Coverage for pre-existing conditions

Ensure that the plan covers any pre-existing conditions you or your family members may have. If you take prescription medications regularly, verify that the plan's formulary includes your medications and offers reasonable copayments or coinsurance. Consider not just the monthly premium but also the deductible, copayments, and coinsurance. A plan with a lower premium might have higher out-of-pocket costs, so weigh the overall expenses.

Compare plans

Utilise online comparison tools or consult with an insurance broker to compare plans from different insurers. Look beyond just the cost and consider the coverage and benefits provided.

Carefully review the plan's summary of benefits and coverage documents to understand what is covered, excluded, and any limitations or restrictions.

Look at reviews

Research the insurer's reputation for customer service, claims processing, and overall satisfaction to ensure you'll receive good support when needed. Take advantage of the annual open enrollment period to review and potentially change your health insurance plan if needed. Depending on your needs, you may want to consider supplemental insurance policies like dental, vision, or critical illness insurance for additional coverage.

In conclusion

Being honest to your insurer will help both parties to be on the same page in the time of need. Be sure to allocate ample amount of your time for research and don’t make haste while buying your health insurance policy.

Disclaimer: *Except for exclusions like maternity benefits, undisclosed diseases, etc. Please check policy wordings for more details.

**The content on this page is generic and shared only for informational and explanatory purposes. It is based on industry experience and several secondary sources on the internet; and is subject to changes. Please go through the applicable policy wordings for updated ACKO-centric content and before making any insurance-related decisions.

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