Insurance as Foundation for Fiscal Fitness – Part 3
I know you are probably thinking “enough about insurance already” so I’ll try to make this one brief or at least combine two topics into one post. Most people know that health insurance is an absolute must in this country. But do you know why? Doctors and hospitals will treat anyone, insured or not. It is the cost of the health care that will wipe you out financially if you do not have at least some coverage.
Most employers offer health insurance and if yours does you are probably fine. Many enlightened employers provide coverage to your domestic partner. If yours doesn’t, ask for it. If you are covered under your employer’s group plan, you need only be careful when you are changing jobs. There could well be a waiting period for coverage under the new employer’s plan and you don’t want to be uninsured for even a short amount of time.
What if you are not employed (and not covered under your partner’s plan) or your employer does not offer insurance? Now you are treading in the murky waters of individual policies. This is not a particularly bad thing if you are healthy. There are a number of online insurance brokerages (ehealthinsurance is one) that can help you find a short term (usually 1-6 months) or a more permanent individual insurance policy. These policies are very reasonably priced, especially if you are young.
Here is the key. Be healthy. Invest your money and time in taking care of yourself and you’ll have MANY fewer health problems (and consequently lower medical bills) than the average bear. Healthy diet and exercise, stress reduction, toxin minimization etc are ways to insure your health. Think of your plan as “catastrophe” insurance rather than health insurance. You can be careful, but you can’t always prevent accidents. Also choose the highest possible deductible to keep those premiums low. If you have built up your cash fund, you will be prepared to cover your deductible. If you are not healthy, or have a preexisting condition, it will take some research on your part to find coverage. That is beyond the scope of this humble post but here is an article that will help.
A relatively new kid on the insurance block is long term care (LTC) insurance. This insurance covers individuals (or couples) with a prolonged illness or disability (think Alzheimer’s). Care can be provided in your home, an assisted living facility or a nursing home. Many people assume that their health insurance, or Medicare, covers long term care but sadly that is usually not true. Perhaps you’re thinking “I’m young and I won’t have to worry about that for ages”. You may be right but, of course, there is a trade off. The earlier you secure LTC insurance, the cheaper it is. You can lock in premiums today for benefits that adjust upwards each year by a cost-of-living adjustment for healthcare (usually more than inflation). If you’re 50 or older, you really should be considering this coverage. Find out more here from the National Association of Insurance Commissioners (NAIC). Domestic partners can ask for a joint policy with a “shared benefits” rider that will allow either partner or both to use the benefit when needed.
Carol Christie is a Registered Investment Advisor and has a fee only financial coaching practice serving individuals and small businesses with a special focus on non-traditional couples.
Photo credit: stock.xchng.