In life, you never really know what’s going to happen. Even if you think that you are healthy and that you would never be hospitalized, there are still possibilities of you getting into an accident or getting a serious disease all of a sudden. The point is, when it comes to your health, it really would be better to be safe than sorry.
The Use of Health Insurance
If it ever happens that you get into an accident and would need to pay a lot for your bills and medications, would you have enough money to pay all those things in one lump sum? Probably not. That is what insurance is for. You pay the insurance company monthly or yearly premiums so that when you need it, they will pay part of your medical bills. It’s just like paying in advance, if you want to think about it that way.
So for a regular health insurance, you’d be paying monthly or yearly premiums and also a deductible. The deductible would be the amount that you have to shell out before your insurance company would pay for their part of your expenses. Catastrophic Health Insurance differs from regular health insurance in that it would require you to pay a higher deductible in exchange for lower premiums.
Difference Between Catastrophic Health Insurance And Regular Health Insurance
Which one is better for you then? It would depend. Regular health insurance would be better for if you are a person who would need your insurance a lot. If you often get sick or often need to visit your doctor and if you have a higher risk of getting hospitalized, that means that you would need your insurance more. If you need your insurance more, then you will be paying more deductibles. So then, if you get a Catastrophic Health Insurance (which has higher deductibles), then you total expenses would be higher. If you take out a regular health insurance, your deductibles would be lower and you will be paying higher premiums. But the premiums are paid in increments. So it would be a better choice in this situation.
Taking out a Catastrophic Health Insurance would be a better choice if you don’t really get sick too much or if you won’t be using your insurance too much. This is because if you don’t use your insurance, you won’t be paying deductibles. So if you pay low premiums and no deductibles, then you would be able to save a lot of money.
Also, this insurance is made to cover only those that are considered as a ďcatastropheĒ, thus the name. This means that you would be covered for serious events/ diseases but not for checkups, day to day health expenses, etc. So if you don’t get sick too much and don’t go for checkups a lot because you are fairly health but would want to protect yourself from those unexpected major expenses, then this is the right choice for you.
Benefits You Can Get From Catastrophic Health Insurance
The main benefit for this type of insurance is that you would be able to lessen your insurance expenses. Yes, you will still pay for other medical fees that are not considered to have been caused by a catastrophe but you would be able to save a lot on premiums. Just keep in mind though that when a catastrophe does come, you will be paying a very high deductible.
Considerations Before Deciding
Before you decide to go for a Catastrophic Health Insurance, it would be better if you think about a few important things first.
Would you be able to afford the deductibles in case something happens? Since this insurance requires a high deductible before they pay for their part, you should be able to afford the deductible. It would be good if you have a savings account meant solely for this purpose so that in case something happens, you would immediately have the money to pay your deductible.
Would you be able to afford the minor medical expenses? The expenses for things like medications, minor causes for hospitalization, visits to the doctor, etc. would need to come from your own pocket if you choose this insurance. Would you be able to afford those things? (This is why it is better to choose this if you don’t get sick too much so that the risk for you paying these things would be very low).
Is there a lifetime maximum amount that your policy would be able to cover? You should ask your insurance agent about this. Most policies do have a cap as to how much they will pay out for your insurance. You need to know how much this amount is and see if you think it is enough for your needs.