Any insurance policy that lasts more than a year is typically considered to be a permanent health insurance plan. This includes most of the individual health insurance plans which are available. There are, however, individual plans that are guaranteed to be renewed, which makes them more permanent in a certain sense.
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Health insurance is extremely important, but there are so many health insurance options available that it can get very confusing. In general, if you find a plan that fits not only your needs but your budget as well, you want to hold on to it for as long as you can.
What is permanent coverage?
Permanent health insurance can cover a variety of things, depending on the plan that you choose. Some plans have common health insurance benefits such as doctor visits, hospital care, surgeries, and some prescriptions. Other plans will offer more comprehensive coverage. Comprehensive coverage includes the aforementioned services as well as additional prescriptions, maternity, vision, and dental.
What is short term insurance?
Short term, or temporary, insurance is different than individual or permanent insurance because it is meant to only be purchased for up to 12 months. Short term health insurance is a good idea for those in temporary situations. Those who would benefit from temporary insurance are those who are in between jobs, just graduated from college, or just got laid off. The application process for short term is a lot easier and faster than that for permanent insurance.
A short term policy covers a lot less than a more permanent one. It usually covers unexpected accidents and disorders but not health conditions you have had in the past. Vision, dental, and preventive services are not incorporated in a temporary plan.
What are some permanent insurance terms?
Whether it is permanent insurance or short term health insurance, you need to understand the terms of the policy in order for you to get the most out of your plan and so you don’t have unexpected medical bills.
One insurance term that can greatly change your premium is the deductible. A deductible is the amount that you pay before the insurance does.
In-network and out-of-network are more terms that make a big difference in how much you pay. Some insurance plans cover for both networks but the coverage is greater for in-network providers. Other plans do not pay anything if you go to someone who is out-of-network.
Coinsurance and copayments are the amounts that you pay after your deductible, but before the insurance company does. Some plans have both, and some have one or the other. For more details on these insurance terms, visit the Insurance Information Institute.
What is a guaranteed renewable insurance policy?
A type of individual health insurance that is essentially a permanent plan is a policy that is guaranteed to be renewed. With this policy, as long as you pay your insurance bills on time every month, the insurance company guarantees that it will renew it, up until a particular age.
Although a guaranteed policy is renewable, that doesn’t mean that the company can’t raise your premiums. It is allowed to raise premiums if you have filed a medical claim or had a new injury. The policy can also be cancelled if you miss one or multiple payments or if the company finds out you lied on your application or committed some other type of fraud.
If you would like to find a renewable policy that cannot have its premium raised, look into noncancellable renewable policies. With these policies, not only are you reinsured year after year, your premiums cannot go up until you are about 65 years old.
There are a number of ways to find an individual permanent health insurance plan. You can search for an insurance broker who will search multiple companies for you. You can also do your own online search, such as on this site.
Always compare a number of plans. This may take a little while and you shouldn’t rush the process. Once you have narrowed your search down to a couple of companies, look the companies up on a website such as A.M. Best. This will let you know how financially stable the company is and if they will be able to pay for claims for as many years as you have the plan.
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