Six top tips for buying cheap health insurance

Buying health insurance for your family is probably one of the biggest financial decisions you have to take. You should therefore take the time to get it right.

1. The family budget
In the good old days when credit flowed like water, there was less need for strict financial planning. If there was a problem, all you had to do was ask one of the card suppliers to increase the limit, or borrow some more against that growing equity in your home. Now the credit crunch has come and the property market has collapsed, we all have to go back to basics. So start a simple set of monthly accounts. List all your fixed bills for the mortgage, utilities, and so on. Now add in the variables for food and card repayments. Take these costs away from your income. You need to come up with a simple number. How much can you afford to pay for health cover without defaulting? Believe me, you don’t want to take on a premium and then default after a couple of months. This will wreck you track record and lose you the premiums.

2. Define your health needs
You need to make two lists given your family’s circumstances. The first will be the ideal cover. The second will be what you will live with when push comes to shove. The point is to make two consistent shopping lists when you contact the insurance companies. When you compare policies, you always want to ensure you’re comparing like with like.

3. Decide what plans you’re shopping for
You need to give yourself the maximum possible choices between different types of health plan, including Health Maintenance Organization (HMO), Preferred Provider Organization (PPO), and so on. It‘s also worth looking at the alternatives such as a Health Savings Account (HSA) or simple term insurance. If a provider network seems a good option, look very carefully at where the nearest doctors and hospitals are located. The further you have to travel in an emergency the more likely there will be complications.

4. Shop around
When you know how much you can afford, start shopping around. Sites like this are the best because they offer a completely free service, allowing you to make multiple searches against all the health insurance companies licensed to write policies in your state.

5. Do you have any pre-existing conditions?
If you fail to disclose a current problem, your health insurance company can cancel the policy. It’s always worth being honest. Most companies operate a “waiting period” before the cover begins. If you’re finding it difficult, contact your local states Insurance Department or Commissioner for advice.

6. Never allow yourself to be rushed
Some insurance companies or their agents may try pressuring you into making quick decisions. Never be a sucker. Take your time. Pick the policy that’s right for you and your family at the best price you can find. Then make a final read-through before you sign — just to make sure it’s what you wanted.