What deductible is best for your Indiana medical coverage? The major medical deductible determines your out of pocket expense for catastrophic claims, such as surgeries, hospital visits and other related costs. Most Indiana companies offer a range of deductible options, typically between $500 and $10,000. While a lower deductible reduces your potential risk, you are likely to pay more in insurance costs than you save on any claims you may have.

Choosing the right deductible is nearly impossible, since it assumes you can somehow mysteriously determine your health insurance expenses for the next few years. But you can base your estimates on your expenses from the last 2-5 years as normally, they are a fairly reliable (OK…somewhat reliable) predictor. But as you get older, your risk of a serious illness increases, which also should be considered.

Let’s use a hypothetical family in South Bend for an example (no particular reason for using this city). Our family consists of a married couple (both age 50) with two teen-age children. A catastrophic medical plan with a $5,000 deductible will cost approximately $338 per month. A $1,000 deductible will cost approximately $565 per month.

By increasing the deductible, the annual savings is about $2,700 per year. Of course, if you have a major claim, the additional out of pocket cost would be $4,000. However, if you had a major claim every other year (which is a lot!), you would come out ahead with the higher deductible. So it appears that a higher deductible is worth consideration for a family that purchases catastrophic coverage.

Using the same hypothetical family in South Bend, a comprehensive Indiana medical insurance plan with a $5,000 deductible would cost approximately $587 per month. But lowering the deductible to $1,000 will raise the premium to a whopping $1,046 per month. So, by saving $4,000 on a major claim, you would pay more than $5,000 per year extra! That doesn’t sound like such a good deal.

Of course, rates can significantly vary in different areas of the state, and ages and medical conditions of family members can impact your decision making process. Also, on an Indiana individual policy (only one person insured), the savings by raising the deductible will not be as significant when compared to a multi-person household.

We’ll be happy to take the time to discuss your options and review what impact higher and lower deductibles will have on your rate. You can also request a free quote at the top of the page. There is never an obligation and you’ll be able too compare many deductible options from multiple companies.

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