At some point most people will experience a change in their Health Insurance coverage. Whether it’s a result of changing jobs, being laid off, or simply changing Individual Health Insurance carriers the transition can be stressful. Often times there is potential for a gap in coverage while going through the transition. One way to easily and cheaply fill the gap between coverage periods is with a Short Term Health Insurance policy. The following three common scenarios are examples of when Short Term Health Insurance can be very beneficial.
Example I: When starting a new job that provides Health Insurance benefits there is most often a wait period that needs to be satisfied before coverage begins. In California, the wait period can be anywhere from a few days up to six months for businesses that employ less than 50 full-time workers. If you don’t have other Health Insurance coverage you will go uninsured until completing the wait period. In this situation a Short Term Health Insurance policy purchased for the exact number of days in the wait period will provide coverage until group sponsored benefits begins.
Example II: For a person who loses his or her Employer Sponsored Health Insurance coverage COBRA continuation must be offered. COBRA allows a person to continue his or her current benefits at either 102% or 110% of the premium. Depending upon the person’s age and current Health Insurance plan the premium can be very expensive and not a viable option for someone who has little or no money coming in. A monthly Short Term Health Insurance policy can provide coverage for up to 6 months while saving significant premium over COBRA coverage thereby giving additional time to sort out other more permanent options.
Example III: When applying for Individual Health Insurance there is an underwriting process that all applicants must go through. Depending upon the person’s health history, medical records may be required. When medical records are requested it can add significant time onto the underwriting process. Even when applying early for Individual Health Insurance coverage, if records are requested, expect to wait an additional few days to a few weeks or more. A 30 day Short Term plan is ideal in this situation to maintain coverage while providing piece of mind as underwriting is completed.
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