Question

Mr. Y said, “Everyone should buy medical insurance for the whole family. Especially for new born babies, you will only need to pay premium for the first 18 years, after that, you don’t have to pay anymore, and the protection will continue for the rest of your children’s lives. So, these plans provide good protection for your children. At the same time, these plans are cheap and they save you a lot of money.”

Comment on Mr. Y statement.   

Answer 1

What Mr. Y had expressed, it is totally a false statement about children medical insurance .Why it is false, has been disclosed below.

• For new born babies their parents must buy medical insurance policy and for them through out their childhood, parents have to pay the premium .
• Under current law in USA ,children medical insurance policy can cover children until they turn 26 years old. So it means children medical insurance policy doesn't cover a child after attaining an age of 26years.
• In this respect what MR. Y said is totally wrong. For these policy parents have to pay premium through out the childhood time of their babies and the policy will be became lapsed maximum after 26 years from the date of purchase . It does not financially protect any child for his life time.
• Apart from the above it is in general not to be said the medical insurance policy for children are very cheap. Economically the price of the policy is called premium amount. If a policy is cheap that means it has some limitations.
• Like insurance companies charge higher premium for those medical insurance which are having (1) no sub limit on any specific treatment , (2) no waiting periods for claims , (3) very well connected hospital network etc.
• So in today's economical state if anybody wants to insure his child with a good and well structured medical insurance policy which provides all the above discussed benefits , then it will be not so cheap.