Insurance health

The Benefits of Owning Health Insurance

Owning health insurance is an important step in protecting yourself if something unexpected happens and you can’t afford the costs of healthcare out of your own pocket. Not owning health insurance leaves you susceptible to medical expenses that could be detrimental to your financial future, especially considering that medical prices continue to rise year after year. But what are the benefits of owning health insurance and why is it so important? If something catastrophic occurs such as experiencing a serious accident or contracting a life-threatening illness, the cost of healthcare can become astronomical if not covered by some other form of insurance. Without having your own health insurance plan, any expenses incurred from these events would most likely come directly from your bank account or from credit card loans which can have high interest rates and devastating long-term implications on your personal financial situation. Read on to discover more about the benefits of owning a health insurance policy.

Protection for your Financial Security

The first and most obvious benefit of owning health insurance is protection for your financial security. If you were to experience a serious accident or become ill, it is important to have the means to pay for the associated medical bills. This is where health insurance comes in. If you experience a life-changing event that results in a high medical cost, the insurance company can help cover those expenses. This is done through a payment of a percentage of the bill and/or a set amount that you must pay out of pocket. The out-of-pocket amount, known as the co-pay, is determined by your plan and can vary from insurance provider to provider. The premium payment that you make each month also varies between plans and providers.

Covers Incidents that Could Be Disastrous

Another benefit of owning health insurance is that it covers incidents that could be disastrous for your financial situation. If you or a family member experiences a serious accident or becomes ill, the costs associated with the treatment of these events could be astronomical. Depending on the severity of the situation, the medical bills could total thousands of dollars. If it is not covered by health insurance, the medical expenses could be devastating for your personal financial situation. If it is covered by health insurance, however, the insurance company pays the bills and you receive a bill showing what amount is expected to be paid out of pocket. This could be a small amount or nothing at all depending

Co-pays and Co-Insurance

Health insurance also offers protection in the form of co-pays and co-insurance. If a procedure or prescription drug is not considered essential, but is covered by your insurance plan, a co-pay will be required. This is a set amount that you must pay out of pocket each time you fill a prescription or have a medical service performed. If the procedure or prescription is considered essential by your insurance plan, you will have to pay a certain percentage out of pocket. This percentage is the co-insurance. Depending on your plan, you may have to pay a certain percentage of the total cost of the procedure or prescription. If a particular procedure or prescription is not covered by your plan, however, you will have to pay out of pocket entirely.

Helps Build Good Credit

A third benefit of owning health insurance is that it helps build good credit. When you pay for health insurance on a monthly basis, the insurance company records your payment as a liability. This is then reported to the credit bureaus and builds your credit score just as if you were to take out a loan. While this may not seem as important as protection against financial ruin or increased credit score, building good credit is extremely important to your overall financial situation. When you have poor credit, it can affect everything from your ability to get a loan to your car insurance rates.

Conclusion

The benefits of owning health insurance are many and varied. When you own a health insurance policy, you are protecting yourself against financial ruin due to high medical bills. This can happen in the event of a serious accident or an unexpected illness, both of which could require extensive medical care. Health insurance protects you by covering the majority of these medical costs, with you having to pay a small percentage out of pocket or a set amount for prescriptions and procedures that are not considered essential. It also helps build good credit and improves your financial situation by protecting your personal finances.

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