Why You Should Review Your Health Insurance Policy Yearly

Sometime in January, we look back on what we achieved the year before and set goals for what we want to accomplish for the coming year. In early spring, we clean out our home and organize what is left behind to take us until the following year. Summer is the time of year to take stock of the condition of our lawns and make the necessary changes to prepare for the next growing season. Fall is the time of year to break out winter clothes and determine what we need to buy for the upcoming season of ice and snow.

Fall also is the time to review your health insurance plan because open enrollment for health insurance begins on November 1, 2022.

Buying a health insurance plan provides you with peace of mind knowing you have financial support in case you must address a health emergency or simply pay for standard care. However, you should not treat a health insurance plan as something that remains constant. In fact, let’s review five reasons why you should review your health insurance plan yearly.

Change of Lifestyle

One of the most important reasons to review your health insurance plan annually concerns lifestyle changes. Factors such as age, employment status, income generated, level of stress, and nutritional habits all play a role in determining the type of health insurance coverage you should purchase. For example, let’s assume you have just turned 60 years old. The healthcare needs you had 20 years ago no longer are relevant in deciding on the type of health insurance plan.

With healthcare costs continuing to increase substantially, you should review your lifestyle to determine whether you can reduce some of the expenses associated with your healthcare coverage.

Speaking of Increasing Medical Costs

Buying health insurance represents a process that requires you to weigh the costs associated with certain types of care with the likelihood that you will need the types of medical care. As we mentioned, healthcare costs have skyrocketed and unless you receive health insurance as a benefit delivered by your employer, you should be vigilant when it comes to the prices that healthcare providers charge for a wide variety of medical procedures.

You do not want to rely on your personal savings to pay off a substantial medical bill.

Introduction of Healthcare Products and Services

Reviewing your health insurance plan yearly makes sense because your insurance company also conducts a review to determine whether to add new products and services. The intense competition between insurance companies spurs innovation in the health insurance industry. New products can include prescription medication packages and new services can introduce new diagnostic techniques. Carefully review your current policy and then see if adding a new healthcare product and/or service is a wise financial decision.

Life Changing Event

If you experienced a life-changing event over the past year, you must accommodate the change by adjusting your health insurance policy. For example, a couple that welcomed a newborn into the family over the past year must accommodate the new family member by adding the infant to the family health insurance plan. Other life-changing events include marriage, divorce, death, and a child no longer eligible to receive family health insurance coverage.

Qualify for a No-Claim Bonus

Health insurance companies offer policyholders financial incentives, such as stopping a smoking habit and following preventive health care tips. One financial incentive you might be able to benefit from during the next year of your health insurance plan is called a no-claim bonus. Health insurance companies offer this financial incentive to policyholders that did not file a claim during the previous year.

If your health insurance plan has a no-claim bonus and you remained healthy over the past year, make sure to activate the bonus when you review your plan before the start of the next policy year.

The Bottom Line

Reviewing your health insurance plan yearly allows you to make changes that match your lifestyle, as well as any life-changing events. You also adapt your health insurance plan to address the rising costs of healthcare and review any new products and services that are offered by your insurer. Reviewing your policy at the end of its term also might activate a no-claim bonus of up to 50 percent of the value of your health insurance plan.

You also should review your health insurance plan annually to change the value of the deductible, coinsurance, and copayment components of your policy. The deductible represents the amount of money that you pay out-of-pocket before your health insurance plan kicks in. Coinsurance regards the percentage of healthcare costs that you pay after meeting your annual deductible. Copayment is the defined dollar amount a patient pays for a particular medical service before the patient’s health insurance covers the remaining cost.

If you need assistance reviewing your policy, we can help! Insurance Broker Hub has helped over 10,000 consumers find the coverage they need at a price they can afford.