Some people have the privilege of having insurance as part of their employment contract. Even if it is only limited to them and only provides a little bit of coverage, it’s way better than having no cover at all. For those that are self-employed, run their own businesses, or earn a living from a different source, finding the right kind of insurance can be challenging.
This is not to say that the insurance cover that your employer provides you is the best option but when it’s part of your contract, there isn’t much you can do to change it. You might find that what your employer provides is insufficient or you might be looking for an insurance policy as a private individual. In either case, you want the insurance market to be one that offers an overwhelming variety of products and services and it can be incredibly difficult to make a decision. This is only made more confusing by the fact that a lot of insurance companies often give the same service a different name, to make their offering stand out.
Secondly, you will find the same service offered at extremely different price points by different insurance companies. It can be very confusing for someone who has never bought insurance before. Most people who don’t have it claim that this overwhelming variety and confusing purchase process is the main reason why they haven’t bought any insurance policy so far. Here are a few tips to make this process a little bit easier for you.
1. Financial Situation
We buy insurance in order to give ourselves and our families some form of monetary relief in the case that something goes wrong. Though if you don’t study the fine print before committing to a plan, you could end up paying more than you can afford on a monthly basis because you were lured in by the eventual payout amount of the policy. There are a few regulation changes that are making insurance cover more accessible for those with a lower annual income, however, these are mostly limited to government-backed insurance policies. Ideally, you should work with a financial advisor who can help you better understand how much you will pay and why you will pay it. More than the final payout of the insurance policy, you need to be confident that you can meet the monthly requirements.
2. Scope of Insurance
If you already have a 401K or some form of medical cover provided by your employer, you might not need extensive third-party health insurance. It might be more effective to get a cover only for the children or just for your spouse. If you are going for a government-run insurance service then it helps to know how to compare Medicare Advantage plans so that you are getting the most value for the money you spend. For instance, if you are already suffering from a medical condition then it might make more sense to get insurance that is designed specifically for that condition rather than general health insurance. Similarly, you can get a particular policy specific for your vehicle, your property, and other items that you would want to insure.
3. Rates Will Vary
This is not just between different insurance companies and different insurance policies but you might end up paying more or less than someone else who is using the same policy as you are. The reason is that when you start applying for policies, the sales rep facilitating you will ask you a series of questions in order to assess risk and to find out how much it might cost you for the insurance company to provide you with insurance cover. Everything from your current medical condition to family medical problems, to the kind of job you do, and your criminal record, all play a part in this evaluation. This is why it pays off to consult with a few different insurance companies before making a final decision.
For some people, it might not work out to do business with a private insurance company since they often have stricter regulations and higher rates. However, if you want the best possible insurance policy, then you need to be ready to pay a premium price. Most basic insurance policies will only provide you the bare minimum form of cover. The best solution is to get a policy specific to a problem you are concerned about and consider getting the best policy you can afford for that. This way, you will have extensive cover for that issue and you won’t be spread thin on any insurance policy that doesn’t provide comprehensive cover in any one area.
