Health insurance

This is an emotive subject and there are no easy answers but let’s start by understanding a couple of important points:

Insurance companies prefer to insure people who have relatively simple medical histories so it’s worth getting onto their books early on. If you change insurance companies too often you risk the new company restricting any claim resulting from a previous medical condition.

Choosing a medical insurance company solely on the basis of premium is risky. A company that charges cheap premiums but is tighter on claims is not what you want when you’re sick. At the end of the day the insurance company also has to be strong enough to still be in business when you need to claim and to have a good, sensible balance between their premiums and their claims.

Contact us to arrange a phone call with an experienced financial advisor about your own situation – it’s free and there are no obligations or catches.

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A sensible approach

The following points offers a sensible approach. In fact, Castle Trust Financial Planning (our partner company) feels so strongly about this that they won’t take on any medical insurance client who isn’t prepared to go carefully through this list of suggestions:

Joining a group scheme at work is usually cheaper but you must make sure there is the option to continue the cover on an individual basis, without underwriting, if you leave.

Do your homework. Get your financial adviser to choose a company that has a good premium and claims record, a good admin system and documentation you can understand. Fill out the application as thoroughly as you can and then stick with that company.

Consider paying the first part of any claim in order to reduce the premium.

Read the Investment page on this website. Reorganize your existing capital so as to create a sensible Reserve fund in the bank or, if you haven’t got enough, then now’s the time to put money aside each month to create one. This isn’t just for medical insurance, it’s deposit money in the bank that can be used for any short term emergency. It can be used to pay the excess on your medical, motor or house insurance for example or any insurance claim that gets rejected. Your medical costs will go up as you get older and you need to have your own reserves to reduce your dependence on banks and insurance companies.

One final suggestion – look after yourself. Which would you rather be – a policy holder with poor health and lots of insurance claims who makes a profit from their medical insurance or one who takes care of their health, doesn’t have to claim as much and effectively makes a loss on their insurance?

Frequently Asked Questions

Why health insurance?

Because medical emergencies are costly and, if you can’t afford it, then you may not get the treatment you need at the time you need it. A medical insurance policy will provide the money for the large claims – it’s a safety net.

What’s it all about?

It’s all about creating a lump of cash when you need it medically. It’s INSURANCE to cover a possible risk – just like house insurance. You can cope with the ‘small stuff’ but, if something serious happens, the financial consequences for your family could be huge.

How does it work?

Work out what size claim you could afford and use this as a policy ‘excess’. It keeps the premium cost down because the insurance company knows it will only have to pay out on occasional larger claims and not more frequent smaller ones.

What’s the downside?

The downside is if you never claim then you’ve wasted your premiums over the years. But let’s face it – is a lifetime of good health a ‘downside’ ?