|
Many people are perplexed because health insurance
companies won’t cover pre-existing conditions. This is an area where
all insurance companies are
very careful. This is one of the main reasons for medical
underwriting. Insurance companies know that if they cover all
pre-existing conditions they won’t be
in business long. For example, if an applicant has a back problem
and is taking medication that costs $100 monthly, an insurance
company will lose money
immediately if the monthly premium is $90. And then, even if the
applicant is not taking medication but has had major back problems,
the risk factor of a
recurring problem is very great. Insurance sales people often ask
the question, “Would you insure a burning building?” Of course no
one wants to be compared to a “burning building,” but we get the
picture. You insure a burning building, you are losing money; you
insure a person with serious pre-existing conditions, you are losing
money. In Arizona a couple of years ago two bona-fide companies were
not careful in their underwriting, and had to leave the insurance
business because of steep losses.
Always read carefully the pre-existing clause/exclusion in your
insurance brochure. If a company says that they will cover all of
your pre-existing conditions,
beware of that company--they won’t be around long. An insurance
company cannot cover all pre-existing conditions and continue to
compete with the premiums of other companies. So always make sure
how a company is going to handle pre-existing conditions. A
pre-existing condition can go back to your childhood. Be aware of
that. If something happened to you 20 years ago, and it hasn’t
bothered you since, it can still be classified as a pre-existing
condition. Always make sure you know how a policy defines and covers
pre-existing conditions. |
