To position yourself better for cheaper rates, you need to understand how insurers compute your rate. Once you know how they think, you’ll know what to do and what NOT to do in order to get cheaper rates…

Insurance is all about managing other people’s risk profitably. The important skill they’ve developed is ensuring they do NOT put themselves into high risk position while doing this. In fact they really do ensure they make reasonable profit by taking care of you. The question now is: How do they successfully classify profiles into risk levels and so stay profitable after providing the promised coverage?

They use the very same factors that are either indicators of, or pointers to, poor health or a higher likelihood of early death. They look at your personal medical history, your lifestyle in general, whether you use tobacco or NOT, whether you’re overweight or NOT and your cholesterol level. They don’t fail to also check things like your family health history, if you have a pre-existing condition, if you’re diabetic and others.

With such details, it’s quite easy for trained professionals to determine how risky it would be for an insurer to provide coverage for a given prospect.

They’ve also adopted conventions to make it easier for them to determine how risky it is to insure a person. Some are labelled as “preferred” while others might be called “high risk”. These are all functions of how risky they find you. And, that is just the beginning…

Different people will check differently to a list of all the indicators used to measure a prospect (some are listed earlier in this article). To ensure they don’t price a low risk too high and so lose them to competition or price a high risk too low and so lose money, they do more detailed computing.

For each indicator, each insurer chooses a different relevancy score. Two major things determine relevancy scores or weightings given to each factor. They are each insurer’s experience and their expertise. One thing results: A huge disparity in the way each insurer scores each factor. This brings about a huge disparity in end results considering the many variable or indicators used.

So here’s what this means…

If you want cheaper health insurance and there are hundreds of insurance carriers to choose from, how do you ascertain who’d have best rate (Or using the right word, plan)?

Important NOTE: By law, insurers cannot give different rates for the exact same plan. But, to make sure they have appropriate rates for for various risk groups (and so remain competitive and profitable) they instead have packaged very many different plans for these very specific profiles. Presently the US has in excess of 10,000 such plans for customers to choose from. Sounds like the same thing as giving different rates for, say, 10 plans if you ask me — Only more confusing ).

You’d have to obtain a good number of quotes, compare plans and thereafter pay for whichever is the best for you.

Are you tired of paying too much? I suggest that you visit these sites: cheap health insurance and low cost family health insurance. Chimezirim has many sites that reveal ways to pay less on insurance.

categories: health insurance,health,insurance