underwriting process

COBRA & the Current Economy: What Happens When Your Company Goes Under?

If you’re terminated from your job or otherwise lose your employment, you automatically become eligible for COBRA coverage. But it’s not given to you. You have to elect it, and then you’re responsible for its hefty premiums. You also have a deadline for electing coverage and cannot miss a payment without running the risk of plan termination. COBRA also only lasts a set amount of time, so it’s important individuals are looking down the road to their post-COBRA coverage decisions.

Most people also don’t realize that if their former company goes out of business, COBRA coverage will die with it. If there’s no plan, there’s no COBRA. That also means if all the employees under a plan leave or are laid off, that plan—and its associated COBRA benefits—can be terminated.

And then what do you do?

Well, you’ve got to go find your own insurance. And people scramble—especially those with preexisting conditions. They’re all wondering, “How do I secure health insurance for my family?

The reality is people who are considered “uninsurable” by carriers don’t have many options. They either need to find a new job with group coverage or start their own business. (A business owner with at least two employees can secure a guaranteed-issue group plan). Unfortunately, a lot of people are otherwise uninsurable in a market that has only gotten more difficult. Carrier underwriters are extremely picky right now in terms of whom they’ll insure for individual/family coverage.

The most important thing for people in any of these scenarios to know is there are affordable options out there. People just aren’t aware how to find them … or if they’re eligible … or where to look. They should be getting help from their broker to do so—and to discuss all the options and strategies available to someone in their specific situation.

People should also be sure to use their broker for regular reviews of their individual plan to make sure it’s still the best option (with realistic premium levels) for current circumstances. When individual/family plan premiums skyrocket, a lot of times that person is eligible for a free transfer to a more affordable plan under the same carrier. Importantly, that switch can be made without having to again go through the underwriting process. Carriers just aren’t always quick to volunteer that information.

These are all issues and questions that a broker can answer in minutes, as opposed to the hours or days that it may take someone to call customer service lines and do research on their own. There are ways to secure coverage or lower premiums, but people need the help of a good broker to know how.

Tagged , , , ,

How to Secure Affordable Health Care After Losing Your Job

Right now thousands of people are losing their jobs because of the rough economic conditions, and one thing that comes with that is the loss of health insurance.

With so many people out of work, a big question out there is: How do I secure affordable health care?

Quality health care plans are out there, but it’s an extremely difficult process to navigate on your own. The truth is it’s not easy to secure insurance right now in the individual/family (non-employee) market. You almost have to be in perfect health because of underwriting.

Any application has to be underwritten, which means carriers have the right of refusal. It’s up to the carrier do decide if it wants to take on the “risk” of insuring you. If you have any preexisting conditions, the chances are very slim a major carrier will take you on.

The bright side is if you are healthy (as an individual or a family), there are a lot of great, affordable plans out there, including a lot of the same plans you enjoyed under employee group coverage.

As a broker, I find a lot of people paying around $1,500 a month for family coverage who aren’t aware of vastly more affordable alternatives. This is often because they don’t have a broker for their non-employee coverage. They went direct—went online and picked a plan on their own. Now, they’re paying $1,500/month, for example, for coverage they rarely use when they could be on a high-deductible plan and paying around $500/month. They could be saving $1,000 every month in some cases and still have an excellent health care plan.

There are some really affordable plans out there right now. We recently put a healthy 18-year-old female in a plan that was only $70 a month. It’s a nice plan with great preventative care features. It has a high deductible, but she’s not going to pay a lot of money up front.

But unfortunately, there are so many people out there with the same healthy profile and circumstances who are paying far more (or have no insurance at all) because they’re unaware of their options and really need some help.

The issue is that often people simply aren’t aware that they can have a broker representing them for individual/family coverage without it costing them a penny. The carrier pays the broker in full, so there’s no disincentive whatsoever to having the expertise of a broker guiding you through the process of securing individual/family insurance. And even if someone has an existing plan, they can still assign a broker (just like with an employee group) to that plan without having to switch to something else.

It costs you nothing to work with an insurance broker. It doesn’t impact your rates in any way, so you should absolutely have and leverage a broker as your partner in your health care decisions.

This process can be so difficult to figure out on your own—especially now. There are so many plans out there and so many decisions to make. If you didn’t know where to look as an individual, you could search for days trying to understand what all the plans mean and what’s the best fit for you.

Some plan names and terminology can be misleading; you could think you’re going to be covered only to find out that what you bought on your own wasn’t what you thought it was. And terribly, most people find that out when in the hospital or submitting a big claim—when they have much more important things to focus on.

A broker can help you navigate your way through the approval process, find the right plan for you and your family and understand the benefits of that plan. Families can save money every month with the right plan, and in this economy the savings go a long way.

It’s just all about understanding what’s out there and what it takes to get covered when insurance isn’t guaranteed-issue. It’s not the friendliest market out there right now for individual/family coverage, but with a little help you can still end up in a great insurance situation.

Tagged , , , ,