Common Mistakes to Avoid When Purchasing Health Insurance

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The rising medical costs and high cost of living make getting a comprehensive health insurance plan a good idea. Currently, there are certain common mistakes to avoid while purchasing health insurance.

Common Mistakes to Avoid When Purchasing Health Insurance

These mistakes are most often made by people who intend to get a health insurance plan. These mistakes can affect your health insurance costs and rates, making it quite hard for people to afford.

Without a proper understanding of the penalties of a health insurance policy along with its clauses, speedy decisions can lead a person to select an ineffective insurance plan that may not render the service they were gotten for. When this happens, they end up having a hard time with their insurance policy.

Before getting a health insurance plan, it is advisable to get a better understanding of health insurance, what plan you need, different health insurance companies, and, most importantly, mistakes you should avoid when purchasing health insurance.

9 Common Mistakes to Avoid While Purchasing Health Insurance

There are several mistakes people make when purchasing a health insurance policy. These mistakes most often turn out to affect their policies. Here are nine common mistakes that should be avoided when purchasing health insurance.

1. Not doing adequate research

One of the common mistakes to avoid before purchasing health insurance is not conducting adequate research. Most people purchase a health insurance policy too quickly without understanding the terms and conditions of the policy.

They also do not compare different policies to find the best insurance policies for their health needs; instead, they purchase the first insurance policy that comes their way.

It is advisable for people who intend to get health insurance to do proper research before choosing a health insurance policy.

2. Choosing insufficient coverage

The cost of health insurance premiums is one of the factors people need to take into consideration when searching for health insurance policies.

However, most people select less-than-optimal coverage plans to have an economic premium outgo and choose plans that have restricted insurance coverage.

This restricted insurance coverage most often causes the policyholder to pay out of pocket, sometimes for a medical emergency. For this reason, the annual cost of insurance premiums is not the main factor to consider when getting health insurance policies.

It is important to consider your family size, expected medical expenses, medical history, flexibility, and hospitalization expenses before purchasing health insurance.

3. Hiding your medical history

People make the mistake of hiding their medical history while purchasing health insurance policies because of the fear of rejection or high premiums.

Hiding your medical history is a common mistake you should avoid making when purchasing health insurance. This is because this act can affect you when you file claims. It may lead to the denial of claims due to undisclosed medical information.

4. Not taking personal insurance coverage

Generally, every employee gets different benefits, including health insurance, from their employer. Health insurance is an attractive benefit offered by employers to their employees, shielding them from financial expenses in times of unexpected events.

This coverage is generally not enough to cover your family, and it will be terminated if you ever lose or quit your job. It is important to have personal health insurance coverage aside from the one offered by your employer.

It is advisable to purchase a low-premium personal insurance plan to offer you financial protection and sufficient insurance coverage, irrespective of your employment status.

5. Not thoroughly reading the policy’s terms and conditions

Generally, an insurance company is required to explain the inclusions and restrictions in an insurance policy document.

Aside from this, it is also the responsibility of a policyholder to understand the policy terms and conditions as well as the exclusions from it. Ignoring your policy exclusion list when purchasing an insurance policy will lead to difficulties when filing claims.

It is important to have a good understanding of your health insurance policy and know the exclusions and inclusions specified. Understanding your policy helps you avoid events that may affect your insurance plan.

6. Misreading the co-pay clause

Most people do not account for increments and the lower purchasing power of money in the future when accepting a co-pay clause. With a co-pay clause, a policyholder is responsible for covering a certain portion of the claim while the insurance company covers the amount left.

This amount is generally higher than the co-pay limit. A co-pay clause is usually for expensive medical treatments, treatment in metropolises, and senior citizens.

7. Getting insurance only to save taxes

This is another mistake people make when purchasing health insurance. While health insurance premiums reduce taxable income, they cannot be the foundation for deciding on a health insurance policy.

The basic purpose of purchasing a health insurance policy is to have comprehensive coverage for health issues and to be financially protected during medical hardship.

Purchasing a health insurance policy with a focus on tax savings will cause a policyholder to invest in policies that offer inadequate coverage.

8. Getting health insurance when you are old

Most people believe health insurance plans are only for senior citizens or are needed only in old age, then make the mistake of investing at an old age instead of an early stage of life.

You cannot predict when a medical emergency will occur, and not having proper health insurance coverage at an early stage may lead to you making out-of-pocket payments for these emergencies. To avoid this, it is advisable to buy health insurance coverage at an early stage.

9. Overlooking the sub-limits

This mistake is common with policyholders; they overlook the sub-limits clause while determining and selecting health insurance plans.

Over time, they tend to face rejection when filing a claim where the cost is higher than the sub-limit as specified in your policy. On your policy, insurance companies indicate limits on their liability in certain events by adding sub-limits.


Why is it necessary to check the network of healthcare providers in a health insurance policy?

To utilize the convenient and hassle-free way of cash-free claim reimbursement, it is necessary to check the network of healthcare provider lists. This way, you can find the best for you and your health needs.

How do I avoid rejection of claims when using my health insurance?

Ensure you submit all relevant documents and medical history to your TPA on time. Review the insurance claim form at least twice before submission to make sure it contains every relevant piece of information required.

What factors are used to determine the premiums on my health insurance policy?

The factors used to determine health insurance premiums are the number of people insured, their ages, occupations, illnesses already in existence, and lifestyle habits such as drinking.

Do all health insurance policies have a co-payment clause?

All health insurance policies have a co-payment clause. This means that they allow policyholders to have co-payments on their insurance premiums.

What are the types of Deductibles in health insurance?

There are two common types of deductibles: voluntary and involuntary deductibles.