Filling out an individual health insurance application can be confusing and difficult. Insurance companies scrutinize these applications, closely reviewing the information you provide. That's why it's critically important that you educate yourself about individual health insurance and your rights as a consumer.
To help make the application process easier, the National Association of Insurance Commissioners (NAIC) suggests that you keep the following information in mind when securing an individual health care policy for yourself and your family.
Overview of a Health Insurance Application
In most states when applying for individual health coverage, the insurance company will request:
Obtaining Medical Records
To ensure you do not inadvertently fail to disclose material information, you should retrieve all of your medical records. Some physicians might ask you to send your request in writing or charge a fee for reproducing your medical records. As a general rule, it is a good idea to request a copy of your files each time you switch doctors.
What is a Pre-exisiting Condition?
A pre-existing condition is a physical or mental condition for which medical advice, a diagnosis, or care or treatment is recommended or received within a certain period of time before the enrollment date of the policy. Even if an insurance company approves your coverage, it might restrict coverage of pre-existing conditions completely or for a specified period of time.
However, once you are accepted for coverage, the company
may only cancel your policy for nonpayment of premium or for a deliberate
falsification of a material fact, such as a omitting a pre-exisiting
condition from an application. Sometimes pre-existing conditions will
cause a claim to be denied or raise your premium.
Complete Disclosure is Required Before Signing the Application!
The last part of the application is an agreement that
typically states any dishonesty or failure to disclose requested or
material information could result in an approved insurance contract being
terminated. Giving accurate and honest answers will save you possible
problems. Sign the health insurance application only after you have
reviewed it carefully to be sure the answers are complete and
Health Insurance Underwriting
Insurance companies will use the medical information obtained on the health insurance application to determine your premium rates. Occasionally, insurance companies will need additional information from your physician or another medical provider.
Once the health status of all applicants listed on the application is determined and the application is accepted, a rate class is assigned and the applicant is put into a pool with other insureds with similar risk characteristics. The premium rate will be charged to that entire class of customers and subsequent annual renewal premiums will be determined by the claims experience of the entire pool.
Individual claims or an illness may cause an insurance
company reunderwrite your policy, causing it to move you to a new rate
class. If you have questions about whether a company is allowed to
reunderwrite your policy, contact your state insurance
Help may be available if you are turned down for individual coverage or find the policy is approved, but the premiums for the coverage are too high. Many states have programs that help provide health insurance to those denied coverage due to a medical or pre-existing condition. There are also programs available federally or through your state to assist with the high cost of health care and health insurance.
Contact your state government to learn about your eligibility for Medicaid (for low-income and disabled persons), the State Children’s Health Insurance Program (SCHIP), high-risk pool coverage for individuals who are denied coverage, prescription drug assistance programs, or other assistance.
Contact the U.S. Department of Health and Human Services for information about Medicare including the new prescription drug program which provides many options. In addition, the federal government provides tax credits for certain workers who have lost their jobs because of federal trade agreements or whose retirement/pension program has failed.
Make sure you check with your state insurance department for your individual state’s laws regarding health insurance and the options available if you are denied an individual health insurance policy.
For more tips about choosing health insurance coverage that is right for you and your family, go to http://www.insureuonline.org/.
The National Association of Insurance Commissioners Headquartered in Kansas City, Missouri, the National Association of Insurance Commissioners (NAIC) is a voluntary organization of the chief insurance regulatory officials of the 50 states, the District of Columbia and the five U.S. territories. The NAIC's overriding objective is to assist state insurance regulators in protecting consumers and helping maintain the financial stability of the insurance industry by offering financial, actuarial, legal, computer, research, market conduct and economic expertise. Formed in 1871, the NAIC is the oldest association of state officials. For more than 135 years, state-based insurance supervision has served the needs of consumers, industry and the business of insurance at-large by ensuring hands-on, frontline protection for consumers, while providing insurers the uniform platforms and coordinated systems they need to compete effectively in an ever-changing marketplace. For more consumer information visit InsureUonline.org.
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