Idaho Individual Health Insurance

On July 1, 1994, the State of Idaho adopted the NAIC (National Association of Insurance Commissioners) Model Act, which changed significantly the way insurance carriers could do individual business in Idaho. Of those changes, the most significant related to how an insurance carrier can establish premium rates for individual Health Insurance Plans they sell. Additionally, on January 1, 2001 the State of Idaho created the “Individual High Risk Pool” providing guaranteed plans to be made available to anyone who would otherwise be uninsurable. These two significant events changed several issues, the most significant of which are:

-Companies are restricted as to the premiums they can charge a particular Individual.
-Every person that applies for Idaho individual health insurance coverage is guaranteed to be able to buy at least one of four state mandated health plans.
-At renewal time, carriers are limited on how much they can increase your rates.

How does an insurer set my Individual Premium rates?

For every particular plan design a company sells, that company has to establish a base rate for that particular Plan. When offering rates to new and existing Individuals the Insurer cannot offer rates less than 50% of the Plans base rates. In contrast, the Insurer cannot offer premium rates higher than 150% of their established base rates for that particular Plan. As such, they are given a rate corridor  that they are required to work within.

Effectively, this creates an environment where a carrier has to balance it’s offerings. On one hand they want to offer the lowest premiums possible for healthy individuals, but they also want to be able to charge the highest premiums possible on unhealthy individuals. The affect of this requirement on the idaho health insurance environment is that it provides a leveling effect on a large scale basis, but still allows an individual carrier to adjust their rates and compete for new business and healthier.

One other control that brings some increased premium stability to individual premiums is a restriction on how much an insurer can change your rates at renewal time. Once you have purchased a specific policy and have been placed at a certain point in the rate corridor, at renewal, the insurer can only increase your premiums 15% for the risk that you present. This does not mean that renewal increases are limited to 15%. Your health Insurance premiums will always experience a “Trend Increase” which represent the normal increases in the cost of healthcare. As such, Your renewal premium increase will be Trend plus whatever additional rate corridor increase they choose to apply.

How do I know from year to year if I should shop around for better Insurance?

With the increasing rate environment for Idaho Health Insurance, most individuals are wanting to look at alternatives every year. However, until you have provided prospective insurers with all your current health information, it is impossible to know if there are more attractive plans that will save you money. This process is time consuming and not very enjoyable for you or your existing insurance agent! That’s why the Semons Financial Group created Iapp. Iapp provides our clients with the most state of the art, unique system available for gathering and maintaining the necessary information to be able to shop the insurance markets at any time.