What is a pre existing condition and why do health carriers worry about this? When Applying for coverage, do I need to tell the insurer or the agent about a medical issue, and what can happen if I don’t?


The dreaded ‘preexisting condition clause’ is huge implied threat to most people getting new individual coverage.   We all fear it and most don’t really understand it.  Facing it and dealing with it will give great comfort.   A preexisting condition is anything you have been seen by a doctor for, taken medication for, or a reasonable person would have seen a doctor about.   If you take high blood pressure medication, you are treated daily, even if you blood pressure is normal.   If you had bronchitis six months ago, it’s a preexisting condition.  These are just a few examples.  


Individual carriers ask lots of health questions when underwriting you so that they can get a full understanding of your preexisting conditions.   All of us have had one thing or another.  That’s normal.  They just want to know if you are a greater risk than most.   Every carrier varies in their underwriting standards and what may be unacceptable to one carrier, is acceptable to another.  Working with an agent that has access to multiple carriers and disclosing your health history to them, gives you a better chance of finding adequate coverage.  


While you may know about the preexisting condition clause, you may not be as familiar with the rescission clause.   A health carrier is given a period of two years to contest your eligibility for coverage.   If you fail to disclose a medical condition on an application, an insurance company that learns of the condition that if they knew about at the time of application, and it would have caused them to deny or exclude your coverage, the carrier may retroactively cancel coverage.  Imagine that you didn’t want to tell the insurer that you hurt your back 5 years ago, and that you had a blown disc in your back, it had caused you no issue in those five years, but that carrier would not have taken you if they knew about it.   They learn of it after you have a heart attack, by accident.   The carrier would be entitled to deny your claim for the heart attack and cancel your coverage back to the day you started.  It’s not common, but this sort of stuff happens all the time.    The sad part is that if you had disclosed this originally, your broker may have found you a different carrier that didn’t care about your old back injury.  


Some of the nationally known health carriers offer you an incentive to tell them about your health history.  They will waive the preexisting condition clause for anything you mention on your application.   So even if you take High Blood Pressure medication, they will cover it from day 1.   As in life, honesty is the best policy. 

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