The Upgrade Challenge: Why You Should Always Opt for the Best Possible Health Insurance Plan

Health insurance is a foundational component of financial planning and well-being in Canada. It provides you with peace of mind knowing that you're protected against large unforeseen health expenses, and supports maintenance of good health.

While it might be tempting to start with a basic health insurance plan to save money, thinking you'll "just upgrade later when you need to", there's a compelling reason why you should aim for the best possible health care plan you can sustainably afford from the outset: the potential difficulty of upgrading your plan later.

The Upgrade Challenge

In Canada, insurance companies offer various health insurance plans tailored to individual needs and budgets. There is a tendency for people, to want to select a basic plan to keep premiums low, however this approach can present potential challenges down the road. When your circumstances change, or your health takes an unexpected turn, upgrading your health insurance plan may not be as straightforward as you'd hope.

Medical Underwriting: The Hurdle to Upgrade

Insurance companies in Canada employ a process called medical underwriting whenever you apply for a health insurance plan. Should you ever wish to upgrade your health care plan to a higher tier at a later date, the exact same process is followed as when you are initially applying.

This process involves a comprehensive evaluation of your health history and current health status. Here's what typically happens:

1. Application: You'll be required to submit a new application for the upgraded plan, which includes detailed medical questions.
2. Medical Records: The insurance company may contact your physician (and pay them) to produce an Attending Physician's Statement (APS). This document summarizes your medical history.
3. Underwriting Review: The insurance company's underwriters will meticulously review all the gathered information.
4. Offer for Coverage: Based on their assessment, the insurance company will make an "offer for coverage." Depending on your health history and current health status, this offer may come with certain conditions or exclusions.

The Pre-Existing Condition Conundrum

One concern during this underwriting process is the possibility of exclusions related to pre-existing conditions. If your health has changed since your initial insurance purchase, you may find that certain medical conditions are excluded from your coverage under the upgraded plan. This can be a major drawback, especially if you're upgrading your plan due to those same health concerns.

The Importance of Choosing Wisely from the Start

Given the challenges and potential limitations associated with upgrading your health insurance plan later, it becomes clear why it's advisable to aim for the best possible plan you can sustainably afford right from the beginning. Here are some key reasons why this approach is beneficial:

1. Financial Protection: Life is unpredictable. By starting with the most comprehensive plan, you ensure that you have adequate coverage when you need it most and avoid the potential buyers remorse of wishing you had selected a better plan.
2. Avoiding Pre-Existing Condition Exclusions: By securing a robust plan initially, you reduce the risk of facing exclusions for pre-existing conditions (or being declined altogether) in the future if/when you decide you want to upgrade.
3. Peace of Mind: Knowing you have comprehensive coverage can provide peace of mind and reduce stress related to health concerns.
4. Option to Downgrade: It's worth noting that you can always choose to downgrade your health insurance plan to a lower plan tier if your circumstances change or if you simply want to reduce costs. Downgrading typically involves fewer hurdles than upgrading.

Conclusion

In conclusion, when it comes to health insurance, the adage "better safe than sorry" holds true. Choosing the best possible health insurance plan you can sustainably afford from the outset is a prudent financial decision. While you can downgrade your plan if needed or desired, upgrading can be a restrictive process. Prioritizing comprehensive coverage from the beginning ensures you're prepared for whatever health challenges life may bring, providing invaluable peace of mind and financial security.

Next Steps:

Aeva was designed to help make the process of selecting a health care plan as easy as possible.

Prefer a human touch? You can also always chat/email/or speak with an Aeva advisor who will be happy to assist you with selecting a plan that's right for you and your family.

Give us a try at https://aeva.ca

Thanks for reading!