A short term health insurance policy provides health cover benefits to the policyholder for a short span of time. A short term health insurance policy can last from six months to a year. There are also certain personalized short-term health insurance policies that last only 30 days.
Short term health insurance is the best option for an individual who is looking for inexpensive healthcare cover for a temporary period until s/he is covered under a group health insurance plan.
Limitations of Coverage in Short-Term Health Insurance
The scope of coverage under a short-term health insurance policy is highly restricted. Insurance companies make sure that an individual is absolutely healthy before awarding him or her short term health insurance cover. Temporary health insurance does not cover regular medical visits and has several exclusions under the policy cover. It excludes pre-existing health conditions or those ailments that an individual suffers from before buying a policy.
A short-term policy provides cover for emergency services, diagnostic tests, hospitalization and visits to specialist doctors. However, the deductibles for a short-term policy can be higher to the extent that an individual effectively ends up paying for all the medical expenses. It is also noteworthy that if an individual buys a short-term policy, s/he becomes ineligible for guaranteed insurance cover. Guaranteed insurance provides medical cover to an individual irrespective of his or her health condition.
Why Should One Buy Short Term Health Insurance?
Short term policies are not meant for everyone. It is an inexpensive but unfruitful insurance policy. Such a policy is suitable only for those healthy individual who are not covered under any healthcare policy for a short tenure. Graduate students, part-time workers and people under an employment transition phase can benefit from short term health insurance.
In the US, a short term health insurance plan is an inexpensive substitute for the COBRA policy. However, if an individual does not qualify for short-term insurance and also exhausts the COBRA continuation period, s/he will end up losing several consumer rights.
To conclude, short term health insurance is a good option for a limited section of the population. However, no matter which policy one buys, it is essential to understand the terms and conditions as stated in the policy disclosure document.