What Are Plan Maximums?

Think of plan maximums as limits on how much money your health insurance will pay for your medical bills. Insurance companies set these limits for two big reasons: to know how much risk they're taking on and to figure out how much to charge you for your insurance.

In this blog post, we will explore the two different types of plan maximums: Lifetime Maximums and Annual Maximums, and why they’re important to understand when selecting a health insurance plan.

Lifetime Maximums

Think of a Lifetime Maximum as the ultimate ceiling on your insurance coverage. It represents the total amount of money your insurance policy will pay out over the course of your life. Once you've exhausted this limit, there will be no further coverage available from your insurance company for the specific benefits covered under that maximum.

For example, if your extended health care plan has a Lifetime Maximum of $300,000, and you incur medical expenses totaling $325,000over the years, your insurance company will only cover up to the first $300,000.Any expenses beyond that will become your responsibility.

Annual Maximums

In contrast to Lifetime Maximums, Annual Maximums provide are set button each year. This maximum sets a limit on the amount your insurance plan will cover in a single policy year. At the start of each new policy year, the coverage amount for the benefits resets to the Annual Maximum.

Suppose your insurance plan has an Annual Maximum of$50,000. In that case, you can access up to $50,000 worth of covered benefits each year. If you use $40,000 in the first year, your plan will reset to the full $50,000 at the beginning of the next policy year.

Why It Matters

Now, why should you care about these maximums when picking health insurance? Well, they can tell you a lot about the cost and coverage of your plan.

• Plans with higher maximums usually cost more because they give you more coverage.

• Plans with lower maximums usually cost less because they give you less coverage.

Pretty straightforward right?

So, when choosing health insurance, think about what you need, how much you can pay, and how much coverage you want. Best practice is to always get the best plan you can sustainably afford from the outset. Checking the plan maximums is a smart way to understand what you're getting and why a particular plan costs what it does.

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!