In the ever-changing world of insurance policies, plans, and premiums, it’s not uncommon for the consumer to feel confused and overwhelmed when selecting a plan for their family. Should you choose the high deductible or low deductible plan, and what impact will it have on your coverage? The term deductible refers to the amount of out-of-pocket costs the policyholder will be responsible for before the actual insurance discount kicks in. The higher your deductible amount, the lower your monthly premiums will be. By selecting a higher deductible insurance plan, your monthly premiums may be lower; however, you will be required to pay a larger out-of-pocket amount before your insurance coverage begins.
While each individual will have unique medical insurance needs, it is important to find a plan that fits your lifestyle, as well as your budget. There are, in fact, many details to consider when choosing a deductible amount for your insurance plan. These include:
When determining your deductible amount, you’ll want to consider how much you can reasonably afford. Can you afford to pay your deductible without accumulating a financial burden of medical bills?
- Take a close look at all of your monthly medical expenses. This includes office visits, prescriptions, and other medical care you may be receiving. Keep in mind that emergencies may arise that will increase this amount.
- Compare your monthly medical expenses to the deductibles that are offered within the policy. How long will it take you to meet your deductible? How many months does that leave you with full insurance benefit coverage?
- Use this information, along with the cost of the monthly premium to determine which plan is right for you.
Whether you have chosen a high or low deductible amount will directly affect your monthly insurance premiums. You can select the best insurance plan for your family depending on your financial and medical circumstances.
If you are relatively healthy and don’t have routine medical expenses, you may want to choose the high deductible insurance with lower monthly premiums. Those who have a substantial amount of medical expenses may benefit more by selecting the low deductible plan.
What is your primary reason for having this particular insurance plan? While some people need standard medical insurance for office visits, prescriptions, medical procedures and emergencies, others simply require catastrophic insurance coverage.
- Comprehensive Coverage: People who need comprehensive coverage rely on their insurance plans to help them pay for their mounting medical expenses. A low insurance deductible will help them to receive insurance coverage after paying a minimal out-of-pocket expense. In this case, the higher monthly premiums are worth the benefits they receive from their low deductible.
- Catastrophic Coverage: People who opt for a catastrophic coverage plan don’t rely as heavily on their insurance plan for compensation on medical expenses. In fact, they rarely use their insurance plan for anything other than wellness check-ups and preventative care.
Choosing the right medical insurance plan can have a major impact on your health, as well as your financial stability. Be sure to consider all factors before enrolling in a high or low deductible insurance plan.