What is short-term insurance and how does it work?

January 7, 2022


RHI Agency Team

Insurance is one of the best ways to safeguard us from any expected events that may cause harm to us, our family, or our property. You might know about life insurance, health insurance, auto insurance, and so on, which usually are long term insurance plans for which we pay a yearly premium. But, have you heard of short term insurance plans?

Short term insurance plans come under health insurance plans and as the name indicates provide temporary coverage to the individual usually for about 1 to 3 months. Some agencies also provide selected individuals short term insurance policies that can last up to a year.

Short term insurance is an affordable insurance option and though it does not provide the same benefits as the major medical insurance policies, it can help to bridge the gap between insurance plans.

Short term insurance plans usually cover any unexpected injury or illness, inpatient and outpatient services of the hospital, and visits to the emergency room. In some cases, short term insurance may also provide discounts for using facilities and meeting doctors under a specific network.

What does not include in short term insurance?

Short term insurance usually doesn’t cover any preexisting health conditions like pregnancy, preventive care, immunizations, vision care, dental appointments, foot care, and other similar services.

Unlike the normal medical and health insurance policies, it is not mandatory for the short term insurance policies to follow Affordable Care Act and hence aren’t required to offer full coverage to the individuals.

Also, short term insurance usually does not include any prescription drugs, except for the ones described during the hospital stay. But, you may receive a discount on the drugs you buy, which is also a good thing.

How the cost of short term insurance is calculated?

Short term insurance costs very less compared to normal health insurance plans which is why it is a good idea to have them when you are between plans. The premium to be paid for short term insurance will depend and vary based on factors like gender, age, your current address, as well as the coinsurance, deductible, and the total amount of the policy coverage. 

When to go for a short term insurance plan

Not everyone needs to buy a short term insurance plan. Here are some circumstances where opting for a short term insurance plan might help you

When waiting for the beginning of Medicare: when your existing health insurance plan expires and you have a couple of months for your Medicare plan to be active, this short term insurance plan will help to bridge the gap.

Job loss: if you lose a job that included an insurance plan, short term insurance is an affordable way to protect yourself for the time being

In good health: if you are do not require a lot of healthcare and are considered healthy and fit, short term insurance can be an alternative to major health insurance plans 

In between medical plans: if you are changing jobs and your new long term insurance is yet to be active, a short term insurance plan will protect you meanwhile

Ineligible for ACA premium tax credits: if you do not meet the requirements of the ACA plan, this short term plan could affordably cover the basic medical needs.

College students: if you are out of your parent’s health insurance plan, then short term insurance would be a good option to protect yourself till you finish school

End word

Insurance is one of the best ways to safeguard your future and your loved ones. Different insurance plans are available at different rates and benefits for your protection. Agencies like RH Insurance agency which are trusted by people all over the world also provide tailored insurance plans according to the needs of different individuals. We have over 20 years of experience and over 20 different companies working under us which will help you to compare quotes without any headaches.  In situations where the major health insurance plans cannot be bought, affordable short term insurance plans are available to save you from huge expenses.

Let’s not forget that health is the most precious wealth and if you have not bought insurance yet, contact us today itself.

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