Suplimental Insurance and HSA

tio76January 24, 2012

My employer recently move us to an HSA insurance program. It looks like a good deal. My employer is going to contribute the difference in premium between our previous PPO plan and the new HSA plan into our HSA accounts.

My question is with a $10,000 deductible does it make sense to get some form of accident insurance? Myself and my family are young and very healthy. It seems our greatest risk would be the cost associated with an accident. In addition to the standard Aflac supplemental insurance I have also found a company called Wholesale Benefit Association (WBA) that offers to cover the first $10,000 in accident related cost after a $100 deductible is met. For my family the monthly cost for this coverage would be $64. Does this make sense? Has anyone heard of this type of insurance? Are there other companies offering this?

Here is a link that might be useful: WBA Accident Insurance

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Your health insurance would cover the medical costs of any accident. Why are you looking for double coverage?

    Bookmark   January 25, 2012 at 9:53AM
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I am sorry I was not very clear. With our new HSA plan the deductible will be $10,000. After which the insurance will cover 100% of the medical costs. I am looking to cover the deductible in the event of an accident to protect the balance on my HSA account.

    Bookmark   January 25, 2012 at 11:02AM
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Increase your medical payments coverage on your auto insurance and any snowmobile, atv or boat policies you may have. In the event there's an accident, your health insurance company will go after those policies to pay before they will. I keep our medical payments at 50k and for those of you that may transport your kids friends or even your own friends allot, increase your medical payments.

    Bookmark   January 25, 2012 at 12:05PM
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My wife's company does this and it is great for young, healthy people. The HSA covers a few grand in medical expenses per year. We have never gone over that except for the birth of our daughter.

If $10k or $8k or whatever would bankrupt you, then yes, you'll need to look at some sort of gap insurance.

Of course, it is always, always better to not buy extra insurance if you don't have to. The way to avoid those ongoing costs is to build up an emergency fund. If you had $10k sitting in a bank account, you wouldn't have to worry about that insurance. You could take whatever extra you otherwise be paying for insurance and start building up some wealth. Just that $64/month would add up to about $78,000 30 years from now at a 7% return.

    Bookmark   January 25, 2012 at 1:38PM
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Most 'accident' insurance only covers you if you are in a common carrier when the accident occurs, such as a train, bus, or plane. I would read things very carefully.

    Bookmark   January 26, 2012 at 6:21AM
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Also check your AFLAC insurance. My DIL has a policy, thought it covered her and her hubby, but when my son ended up in the hospital for 2 weeks, they paid nothing, due to it was a accident only policy, but even after reading the policy it was very vague. Dealing with a agent was a nightmare and my son had to go clear to the top to get anything clearfied. Agent would not return calls, would not refer they to anyone else. Real bad situation. Read your policy very careful now before anything happens.

    Bookmark   January 26, 2012 at 4:42PM
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I think I would focus on funding your HSA rather than buying accident insurance. As others have said, its coverage is limited, and there are actually lots of other things that could happen to run up a $10,000 bill: a burst appendix, a pregnancy, etc.

Take the $64 you'd spend on accident insurance, add a few hundred dollars of your own, plus what your employer is putting in, and you'll easily have half the deductible by the end of the year. Do that twice and you're done (plus all those contributions are tax deductible)! Other than whatever medical expenses you do incur and will have to replenish.

    Bookmark   January 28, 2012 at 8:53AM
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