Insurance Company – Premiums And Your Health

When looking for an insurance company to provide health coverage, it is important to understand the difference between for profit and non-profit companies. A for profit company, which can be either for profit or non profit, sells the promise to cover certain expenses from the insurance company itself, known as a policy, for a monthly premium. For instance, if one buys health insurance, the insurance company is legally obligated to pay (some of) a client’s medical costs, should any arise. If a non-profit company doesn’t sell policies, it does not make a profit.Insurance Company-Miller Hanover Insurance has some nice tips on this.

Since insurance policies are rarely sold for the actual amount of the claim, insurance companies use two primary means of collecting regular payments: deductibles and regular premiums. Deductibles are the amount of money from the policyholder’s pocket that the insurance company pays first before the benefits are paid out. Regular premiums are what policyholders pay first, covering their regular medical expenses. However, some insurance policies do offer a combination of deductibles and regular premiums, so they can pay a lump sum amount down the line for claims, regardless of how much the claim is worth at the time. Policyholders who find themselves in a financial bind and can’t afford their policy’s full cost at the time often choose to pay higher premiums and deductible amounts in order to “buy down” their policy and lower their costs overall.

It is important to note, however, that insurance policies are not “set in stone.” Many factors, such as a person’s health and age, impact the premiums the insurance companies charge. Also, certain types of claims often go unpaid, such as automobile accidents, while other claims are paid very quickly, allowing insurance companies to keep premiums from increasing. For this reason, it is important to shop around to find the insurance policy that best fits your needs and budget.

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