Individual Health Insurance Coverage

By: EconomyWatch Content   Date: 8 February 2010

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Owing to an increasingly stressful life and the rising cost of medical services, purchasing health insurance is a prudent investment for everyone. Most people are covered under employer health insurance plans or government-approved schemes. However, people who do not qualify for these policies can resort to individual health insurance coverage.

Scope of Individual Health Insurance Coverage

Individual health insurance coverage is also called private or personal healthcare plans. In some countries, individual health cover includes one’s spouse and children, apart from the policyholder. Such plans are particularly ideal for self-employed individuals, unemployed people and students. People who are covered under group or government plans can also apply for individual health insurance to extend medical benefits.

The scope of coverage for an individual health care policy differs among insurance providers. Typically, one should look for the following covers:

  • Hospital accommodation and nursing
  • Inpatient tests
  • Surgery
  • Outpatient treatment
  • Specialists’ visits
  • Physiotherapy
  • Prescription drugs

Mostly, an individual health insurance policy does not cover the following expenses:

  • Cosmetic surgery
  • Dental services
  • Drug abuse
  • Experimental drug treatment
  • Gender change
  • General practitioner visit
  • HIV/AIDS treatment
  • Infertility treatment
  • Kidney dialysis
  • Organ transplant
  • Pregnancy and maternity treatment
  • Injuries arising due to risk-prone activities, such as racing, paragliding or bungee jumping

Individual Health Insurance Coverage vs. Group Policy

Individual health insurance coverage is expensive, as compared to a group policy. A group insurance policy is mostly provided by the employer. Owing to the large amount of business being offered, the employer can dictate the insurance terms and conditions in favor of the employees. Thus, an employee with unfavorable medical history can also get health cover under the group policy. Since, the insurer deals with the company’s administration department, there are no documentation hassles as well.

In an individual health insurance, the insurer excludes medical expenses incurred for the treatment of pre-existing health conditions. Some insurance companies ask applicants to undertake a medical fitness test. Based on the fitness test results, an insurance company has the right to decline medical cover to the applicant. Mostly, insurers use this right to turndown applications that entail a higher risk of policy claims.

In 2009, the US government amended the health care laws to extend the benefits of medical insurance to all citizens. According to the law, private insurers cannot decline health cover based on age and pre-existing conditions, with a few exclusions.


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