June 14, 2005

• I just changed my no insurance policy.  That’s right, I said “no insurance.”  See, they charge for something that’s usually unnecessary, and then every once in a while if someone does need it, they pay it back (but they’ll even fight about that).  It’s like a savings account that if you don’t ever use, they keep.  They are thieves. 

   

  Case in point.  Without divulging too much of my personal finances I will say that I recently got a notice of increase to the medical insurance policy that covers my family.  So, I decided to consider going from a $1000 deductible to a $5000 deductible.  That’s a scary proposition, right?  I mean what if something happens.  And those deductibles are per person, the kids counting as one person.  So worst case scenario I could have a $15,000 deductible.  Doesn’t sound like a good idea.  Until you look at the premiums.  

   

  My savings in premiums will be 403.81 a month.  So I save $4,545.72 a year by increasing my deductible by $4,000.  That means, even if I hit the deductible every year for a person I’m still better off.  And if each person hits the deductible once every three years (and that’s a high deductible so its not easy to do), I’m still better off.  

   

  That means that the insurance company makes money on the plan I used to have even if every one of their customers has a medical expense that exceeds their deductibles once every three years, and if every family on their plan exceeds one of their deductibles every single year.

   

  Insurance is supposed to spread the cost, not charge everyone for it.  Why is this allowed?

  • 11:03 am
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