Retirement Planning - Five Crucial Health Insurance Selection Tips For Baby Boomer's

By David Skill

 

Wow! Retirement is just around the corner. Although retirement activities and travel may be dominating your thoughts, it is critical to spend time evaluating your health insurance options.

Unless you are in a shrinking group of lucky workers that will have continuing coverage from your company here are five tips to consider as you look for an individual family plan.

Do You Qualify?

If you have been insured under a group plan during your working years you have been automatically accepted regardless of the health history of any family member. Qualifying for an individual plan is at the discretion of the insurance company after evaluating your family history.

What could keep you from qualifying?

Every insurance company has different criteria, but some common ones are:

Pre-Existing conditions such as a disease, mental health conditions and frequent use of prescription medications.

Could you qualify with conditions?

A waiver is a fairly common practice with insurance companies. For example: Let's say your wife is a cancer survivor. Instead of rejecting your application they could accept you and your wife but determine they will not cover any cancer claims from your wife. Another type of waiver is to make you wait six months before they will cover a certain ailment.

Another condition of approval could be to 'rate up' your family. For instance they may tell you your application is accepted but your premium will be 40% higher than the published rate because your frequent use of prescription drugs will drive up their costs.

Evaluate the insurance company and the plan.

The insurance company is evaluating you, and you need to evaluate them as well. Be sure you understand:

If your plan is community rated. If so, you can not be individually singled out for a rate increase. The insurance company has to increase everyone's rate that carries the same policy. I believe it is too risky to accept a policy that is not community rated.

What is the lifetime maximum? The insurance company will tell you the maximum amount of money they will pay on your policy. The minimum I would accept is $3 million dollars. Considering one bout with cancer could cost $600,000- $1 million, you need to make sure you are adequately covered over the long haul.

Is the insurance company solid? The highest rating for an insurance company is AAA. That is what I would demand. You have to be confident your company will be around to cover your claims.

How expensive is it?

Chances are your company is subsidizing 75% - 80% of your current plan. Add the amount you currently pay in premiums and out of pocket and multiply by four or five to get a ball park figure of what you would pay with an individual policy.

Once you find out the insurance companies condition of acceptance and you have evaluated their offering then you are ready to decide if it makes sense for your family. Good luck and do not go one day without insurance coverage. With healthcare costs today, it is too risky.

David Skill, a 'Chartered Retirement Planning Counselor' has created an easy retirement system that enables conscientious baby boomers to determine how much money they need to retire. David asks all the vital questions, uses common language and plenty of examples so the participant builds confidence their money will last through retirement and they will not burden their children. Check out http://babyboomerseasyretirement.com/ Article Source: http://EzineArticles.com/?expert=David_Skill