What’s the difference between an individual gap insurance plan and a group gap plan?

We regularly get inquiries about gap plans, and this is a common question.

We describe group gap insurance plans for employers here.

Essentially, a group gap health insurance plan will usually offer the same kind of comprehensive coverage you get with a major medical insurance plan. They begin paying after a lower deductible and stop paying after a few thousand dollars – usually matching the major medical insurance deductible. That way the major medical policy begins paying all expenses when the gap plan stops.

The result is you get very good coverage at a lower price.

Can you get individual gap insurance?

Yes and no.

To our knowledge, as of this writing, there is not an individual gap insurance plan on the market that offers the same kind of comprehensive coverage you get with major medical insurance.

There are, however, several companies that offer gap plans that essentially bundle together a couple of helpful supplemental policies in order to help you meet your high deductible if something happens.

The plan we recommend is called the “Plan Enhancer” with a company called National General Insurance.┬áThe Plan Enhancer gives you three options that you can combine to create your own customized gap plan:

  • Accident Insurance (AME). The plan pays up to the maximum benefit for medical care resulting from any kind of accident.
  • Critical Illness Insurance (CHS). The plan pays up to the maximum benefit for heart attack, stroke, and most cancers.
  • Hospital Indemnity (SIP). The plan pays up to the maximum benefit if you are admitted to the hospital with an illness.

For most people, if they are going to meet the high out-of-pocket costs that come with most individual┬áhealth insurance plans, it is because of something covered in these three benefits. (But note it’s not perfect – there are potential medical costs that wouldn’t fall into one of these categories.)

You choose your maximum benefit level (usually based on what your out-of-pocket max is on your health insurance plan), and the price adjusts accordingly.

(Note: This enrollment page includes several different plans, so you’ll have to scroll down to find the Plan Enhancer.)

You don’t have to worry about any kind of enrollment period for this gap plan – you can sign up anytime. There’s no contract with this plan so you can also cancel it anytime. Many of our clients (including me personally) appreciate the extra protection this plan brings at a reasonable price.

Contact us if you have questions.

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