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Types of Health Insurance PoliciesThere are a range of different types of cover, depending on individual need and income level. The 6 main categories of health insurance as follows:
PackagesThese are pre-determined types of cover, which have been set by the provider. These are designed for the ‘average’ family and tend to have set limits, which are aimed at reducing costs for both the insurer and the customer. Very often, a provider will have a range of packages, for example, budget, premium and luxury, which the customer can purchase according to need and price. This can make it easier for both parties as the customer can see what they are likely to get in a package and how much.However, they do not suit everyone as they tend to have limits on how high the excess is, or the amount you have to pay, when making a claim. Also, because it is has been pre-set, you are not able to choose which extra benefits you would like, or wish to exclude so they can be restrictive. It is important to note that there is no one standard package. Each insurance provider is different, and will have their own views on what range of benefits they will offer, and the extent of that range. These packages will include costs for private healthcare and may include habitually or as an option, other related health insurances, for example, critical illness insurance. A package will usually cover costs for in-patient, day-patient and outpatient treatment, hospital charges which include accommodation costs, specialists and consultant fees, radiotherapy and chemotherapy, physiotherapy, scans and other diagnostic tests, and psychiatric treatment. These are ‘core items’ and will usually, though not always, form the basis of all types of cover. There are also a range of benefits which may be included as part of a package or as an option. These are as follows:
In regard to limits, these can include the number of hospitals that you can use, the amount that will be paid out per claim and the period of time that can be covered, e.g. the number of weeks or months. Conversely, some providers may offer full cover with no limits. This is something you need to consider carefully. Limited coverThis is as the name says: it only covers the most basic of private health care with the customer having the option to ‘top up’ if required. This is very much a ‘budget’ scheme for those people who can’t or won’t pay for full cover. Many people will purchase this type of cover to cover basic private care or certain medical conditions, whilst relying upon the NHS for serious conditions or anything major. They may not want to purchase a package which includes extra benefits that they will not use. Basically, this is a low-cost, ‘no frills’ type of cover.Choice of coverA choice of cover is aimed at those individuals who wish to ‘pick and choose’ their cover. We are all different when it comes to healthcare, with individual needs and requirements. With this option, a customer can personalise their cover by choosing those extras which are relevant to their lifestyle and income. For example, a family with two children is likely to choose different benefits as compared to a 25 year old, single man.There is usually a basic ‘core cover’ which every type of policy will have. Then, a customer can add to this by selecting from a wide range of benefits. As with the packages, there may or may not, be limits regarding these types of cover. Cover for the over 50’s and the elderlyAs we grow older, the likelihood of things going wrong tends to increase. The body does not always function as well as it used to and is likely to start showing signs of wear and tear. Illnesses and conditions such as arthritis, heart disease, strokes and cancer are linked to the ageing process and are much more prevalent in older people than the young.In regard to health insurance, an older person may be more likely to make a claim and, more frequently than a younger person. Older people are more likely to suffer from chronic or long term conditions which can be problematic in regard to health insurance. However, some providers offer health cash plans which can cover the costs related to these. Also, many older people are likely to be retired, or semi-retired, with a corresponding drop in income. This can mean they are unable to afford private medical insurance or may see it is as a ‘luxury item’. They may also have been in the position whereby their employer offered health insurance as a perk of the job, which ceased upon retirement. Health insurance tends to be more expensive as monthly premiums often increase with age. Basically, the older you get, the higher the level of your monthly premium as you are seen as more of a ‘risk’ than a younger person. In this case, an older person would be wise to check out the limited cover scheme as well as seeing if their former employer operates a scheme aimed at retired employees. Shared riskThis type of cover is for those people who do not want or can’t afford full private health insurance, but, are also wary of choosing ‘limited risk’ cover. Limited risk cover may not cover those treatments which they need or it may cover a range of extras which they don’t need. Again, it is down to personal choice.In this case, the customer can choose to share the risk with the provider in a variety of ways. The first option is to opt for Shared Responsibility cover in which the customer pays a percentage of the treatment costs themselves, for example, 50 per cent of the costs. A second option is that the customer pays an increased amount of excess in the event of a claim, and the provider reduces the costs. Thirdly, a customer can choose to take out a high excess policy: this only offers a high excess which are in the range of £1,000, £2,500, £3,000 and £5,000. Some policies restrict the total amount you are asked to pay in a year. Special cover plansThese are specialist types of cover for selected risks or for unusual or innovative cases. These are designed to cover those areas of needs which are not covered by one of the packages or some other form of cover. As these are specialist products and in some cases, new on the market, it is worth getting expert advice beforehand.These special cover plans include the following:
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