Plan Descriptions

Plan Descriptions 

Small Business and Individual Life & Health Insurance

 Simplified Plan Descriptions 

1. Individual Health Insurance 

2. Group Health Insurance Group 

3. Life Insurance 

4. Medicare 

5. Final Expense Plans 

1. Individual Health Insurance Medical Plans 

Medical Plans-Generally cover hospitalization, physician fees, prescriptions and medical supplies at any licensed facility. There is usually an annual deductible and coinsurance. Coinsurance is when the insurance company pays a percentage of the medical costs as well as the insured ( i.e. 80/20 ). Coinsurance limits are called “stop loss” and limits the maximum out of pocket expenses for the insured in a calendar year. There are 2 types of medical plans, PPO and HMO. Preferred Provider Organization (PPO) means that you will choose providers in a ‘Network’ in exchange for reduced fees, which are passed on to the insured in various ways and degrees. You will not need referrals for a PPO. Health Maintenance Organization (HMO) means that you will receive the same types of medical services as in the PPO, but you will have a Primary Care Physician (PCP) in charge of your medical services and you will need a referral for other services not provided in primary care settings.

2. Group Health Insurance Most Group plans will provide the same type of medical service as individual plans, however group insurance for business will have a minimum of 2 full time employees and they must work a minimum of 30 hours per week in order for a group plan to exist and at least 70% of employees must be in the plan. This ensures adequate participation for the insurance companies so as to avoid adverse selection, meaning insurers don’t want only your ‘sick employees’. In addition, your employer, is required to pay a percentage of the employee monthly premium.

3. Group Life Insurance These plans are usually required in conjunction with group health insurance plans and can be provided in a variety of ways. There is no cash value to these plans and when the health insurance benefits stop the life insurance is also terminated. Amounts of Term coverage usually will not exceed $50,000.

4. Medicare A plan for seniors 65 years and older and some people with Disabilities under age 65 receiving Medicare parts A & B. Medicare is available to those seniors turning 65 all year long in either a Medicare Supplement (PPO) or Medicare Advantage plan (HMO). Part D prescription co-pay plans have the same rules as Supplements and Advantage plans. Most Advantage plans cover prescriptions with co-pays. Supplemental plans usually cover the amounts of money not covered by Original Medicare and are often subject to deductibles and co-pays.

5. Final Expense Plans A plan for those aged 55-85 years who would like to pre-plan their Funeral arrangements in advance. Traditional Burial and Cremation plans all come with free a ‘Memorial Guide’ to write down last wishes and usually range in value from $5000 to $25000. All plans will have some cash value over time, these plans are not Term Insurance. Final Expense plans are usually not subject to Estate or Federal Taxes and are paid out within 48 hours of a death certificate being presented. Most Funeral Homes will accept these plans as payment for services rendered, but may not be full payment depending on the face value of the plan.