Basics of Buying

Here are some helpful tips to keep in mind when shopping for medical insurance:

• Shop carefully before you buy - Policies differ as to coverage and cost, and companies differ as to service.  Compare before buying.

• Don't buy more policies than you need - Duplicate coverage can be expensive and generally is unnecessary.  A single comprehensive policy is better than several policies with overlapping or duplicate coverage.

• Know with whom you are dealing - A company must meet certain qualifications to do business in your state.  You should check with your state insurance department to make sure that any company you are considering is licensed in your state.  This is for your protection.  Agents also must be licensed by your state and may be required by the state to carry proof of licensure.  If the agent cannot verify that he or she is licensed, do not buy from that person.  A business card is not a license.

• Get agent and company information - Write down the agents' and/or companies' names, addresses and telephone numbers or ask for a business card that provides all that information.

• Check on the financial stability of the company you are considering - Several private companies or rating agencies conduct financial analyses of insurance companies and grade them.  These ratings carry no guarantee of accuracy, but can provide you with information on how some analysts view the health of particular insurance companies.  Different agencies use different rating scales, so be sure to find out how the agency labels its highest ratings as well as the ratings for the companies you are considering.  Ratings from some agencies are available at most public libraries, or you can call the agencies directly at the numbers listed below.  (Note that there will be an extra charge on your phone bill for calls to "900" numbers.)

  A.M. Best Company . . . . . . . . . . . . . . . .	(900) 420-0400
  Duff & Phelps, Inc. . . . . . . . . . . . . . . . . .	(312) 368-3157
  Fitch Investors Service, Inc . . . . . . . . . .	(212) 908-0500
  Moody's Investor Service. . . . . . . . . . . .	(212) 553-1653
  Standard & Poor's. . . . . . . . . . . . . . . . .	(212) 208-1527
  Weiss Research, Inc. . . . . . . . . . . . . . . .	(800) 289-9222

• Take your time - Don't be pressured into buying a policy. Principled sales people will not rush you.  Be suspicious of agents who try to force you to make an immediate decision or attempt to get you to pay by the year.  If you are not certain whether a policy is what you need, ask the salesperson to explain it to a friend or relative.

• Complete the application carefully - If you do decide to buy, do not believe an insurance agent who says your medical history on an application is not important.  Some companies ask for detailed medical information.  If you leave out any of the medical information requested, coverage could be refused for a period of time for any medical condition you neglected to mention.  The company also could deny a claim for treatment of an undisclosed condition and/or cancel your policy.

• Look for an Outline of Coverage - You should be given a clearly worded summary of the policy ... READ IT CAREFULLY.

• Do not pay with cash - Pay by check, money order or bank draft made payable to the insurance company, not to the agent or anyone else.  Get a receipt with the insurance company's name, address and telephone number for your records.

• Policy delivery should be prompt - The insurance company or agent should deliver a policy within 60 days.  If they don't, contact the company and obtain in writing the reason for the delay.  If 60 days go by without a response, contact your state insurance department.

• READ YOUR POLICY CAREFULLY - Check to be sure a copy of the original application is attached to the policy and it is complete and accurately reflects your medical information.  Review the schedule of benefits and verify the information is correct and what you were expecting.  Make sure there are no pages missing and no unexpected riders or exclusions included in the policy.
  IMPORTANT: Your policy is the insurance contract. If you have questions about it, call the company and get them resolved during the 10 day "Free Look" period.