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Catastrophic Health Insurance

May 22nd, 2009

Catastrophic Health Insurance

Credit: leoncillo sabino, via Flickr under creative commons

Catastrophic health insurance policies are quite expensive but it is not that the premiums are so high; in fact the premiums are rather low. It is the deductible for catastrophic health coverage that is so high. With the economy in recession, many people are finding it rather difficult to keep health coverage. One way to stay insured if you are healthy is to purchase a catastrophic health insurance plan. You would have to be able to keep a savings account, or keep money aside for the deductive. A catastrophic policy is similar to a high deductible account, except that a catastrophic policy has a limited cap up to a million dollars or more per person for a lifetime. .
Not everyone needs to have a catastrophic health insurance policy; however, many professionals in high-risk professions like to have catastrophic health coverage in case the unimaginable happens. For instance, a stunt motorcycle rider would need catastrophic health insurance were he/she involved in an accident while performing a stunt. For example, a well-known motorcycle stunt performer stated that over the course of his career, he had broken every bone in his body. Clearly, without catastrophic insurance, people working in dangerous professions might find themselves underinsured.
Catastrophic health insurance does not usually cover well doctor visits, such as for routine physicals. This type of health coverage does not usually cover maternity care or mental health care. It does, however, pay for medical and surgical procedures. Compared to other health coverage the premiums are lower, but their deductibles are higher than most personal or family insurance packages.
Older adults favor catastrophic health insurance more; however, some younger people just starting out in adult life sometimes choose catastrophic health insurance because the premiums are so low. Their reasoning might be that unless they were to become very sick or receive an injury of some kind they would rarely use their health coverage. Older people often buy catastrophic insurance to protect them from such illnesses as stroke, health attack and cancer.
If you choose a catastrophic health plan you would need to keep money saved back for the high deductible. This form of health insurance does not pay for health care until the deductible is paid. Catastrophic health insurance policies often have a $1 million to $3 million cap per person for a lifetime. This sounds like a lot of coverage; however, medical bills in a catastrophic illness or injury can mount up fast. If you were thinking of purchasing catastrophic health coverage, it would be a good idea to purchase a plan with no less than a $5 million cap per person for a lifetime. Investing in catastrophic health insurance while you are younger can save you from financial ruin later on in life.

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