March 23, 2005

COLLEGE STATION – Here's a little quiz:

Not only is the cost of medical care in all its forms rising, but so are the costs of health insurance premiums. Maybe your own premiums have risen dramatically. Maybe you've already lost coverage.

So what are your options?

(A) Lose sleep worrying.

(B) Panic every time one of the kids coughs.

(C) Purchase every health insurance offer that comes through the mail.

Or how about (D) None of the above, said an expert with Texas Cooperative Extension.

Losing sleep and panicking are not really productive, said Nancy Granovsky, Extension family economics specialist.

And as for buying every offer that comes through the mail – that's just not using good judgment, she said.

Some of these offers are for insurance coverage that's so specific it will probably never be needed – for example, plans that only cover accidental injuries.

"If people have regular health benefit plans – if you're already covered – then most of the things that are going to happen are already covered or partially covered," Granovsky said.

Some plans promoted by mail may offer the first month or two of coverage for free, then bill each month on your credit card, Granovsky said.

"If you don't pay the balance off each month, you could pay a high rate of interest and incur expensive finance charges for a plan of questionable value."

Before you agree to any insurance plan, she said, "read it carefully." Make sure you know exactly what you are paying for.

Jim Hurley, director of public information with the Texas Department of Insurance, agreed.

"A lot of these things that come to people (through the mail) represent themselves as insurance but they are not," he said. "Look at the fine print. Typically they are offering some kind of discount card."

With many families losing their health insurance coverage, many scams are out there, trying to take advantage of the situation.

"People might have lost their insurance and are looking for ways to take care of their families," Hurley said. "It may look like a good deal, but a lot of times it's not."

His advice: After reading the fine print, visit the department's Web site at www.tdi.state.tx.us .

"Our Web site has a place to look up (insurance) companies," Hurley said. "If they are authorized to do business in Texas, it will be listed on our Web site. If they are not listed, they are not authorized to do business in Texas."

Insurance companies wishing to do business in Texas must meet the department's standards, he said. Once authorized, these companies must continue to meet the qualifications.

"We keep close tabs," Hurley said.

If an unauthorized insurance company is doing business in Texas, he said, not only is that illegal but customers of those companies have no consumer protection if their policies fail.

"Do not ever do business with someone who is not authorized to sell insurance," he said.

But authorization to do business doesn't guarantee complete customer satisfaction, he added. For consumer awareness and protection, complaint ratios are also listed for each authorized company.

"If there are a lot of complaints (about a particular company), beware."

For more information on insurance in addition to the Texas Department of Insurance, Granovsky recommended also visiting these Web sites:

- National Association of Insurance Commissioners at www.naic.org

- Insurance Information Institute at www.iii.org