 | Insure Dependents For Less? |
Maybe! In some cases, people with group health insurance may be able to save significant dollars by insuring their spouse or child separately on an individual health plan.
Proceed carefully however, as potential pitfalls do exist!
Is Your Dependent A Candidate For Savings?
Maybe, if your dependent is completely healthy, with no prior history of any chronic or ongoing medical condition. Your dependent should have no need for maternity coverage. Other benefits may be reduced, such as alcohol and drug rehab or mental health coverage. Compare benefits very carefully!
For some people, significant $ savings are possible. Here's why.
In most cases in the State of Florida, group health insurance is offered on a guaranteed-issue basis. This means that a regular, full-time employee and the employee's legal dependents can not be declined for coverage due to health reasons. (Note: Certain pre-existing conditions may be excluded from coverage for a period of time. Consult with your agent or plan administrator for details.)
On the other hand, individual health insurance is medically underwritten by the insurance company. An applicant may be accepted or rejected depending on his or her health status. The decision is entirely up to the insurance company. Insurance companies are able to offer lower premiums on individual health plan because they are able to screen the risk.
Before removing your dependent from group coverage, be certain of the following:
1. Be sure that the insurance application was completed accurately and with full disclosure. (See Health Insurance Buying Tips)
2. Do not cancel any existing group coverage until you have written confirmation that your individual health plan is approved.
3. Understand the limitations and exclusions on the individual plan, especially exclusion of coverage for "pre-existing" conditions.
4. Know when and how your dependent will be eligible to re-obtain coverage under your group plan.
5. Understand that you will be responsible for the administration of your individual health plan, i.e. payment of premium, handling of claims, etc.
Savings are possible, but proceed prudently.
Top of Page
