Catastrophic Health Insurance: What It Is and How to Get It

Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

Understanding Catastrophic Health Insurance

Catastrophic health insurance is a type of medical coverage designed for people who are in good health and do not require frequent medical care. It primarily covers significant, unexpected health events, such as severe illness or accidents. These plans typically have lower monthly premiums but higher deductibles than standard health insurance plans.

Catastrophic Health Insurance

Key Features of Catastrophic Insurance Plans

  1. High Deductible: The main characteristic is a high deductible, meaning you pay more out-of-pocket before insurance coverage starts.
  2. Lower Premiums: Generally, these plans have lower monthly premiums compared to other health insurance plans.
  3. Emergency Coverage: They provide essential coverage for worst-case scenarios, like major surgeries or emergency room visits.
  4. Preventive Care: Most catastrophic plans cover certain preventive services without additional cost.

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Who Should Consider Catastrophic Insurance?

  • Young Adults: Particularly those under 30 who are in good health.
  • People on a Tight Budget: Who cannot afford higher premiums of traditional health insurance.
  • Healthy Individuals: With minimal need for regular medical care.

Examples of Catastrophic Health Scenarios

  • A severe car accident requiring hospitalization and surgery.
  • Unexpected diagnosis of a serious illness like cancer.

Comparing Catastrophic Insurance with Traditional Plans

FeatureCatastrophic InsuranceTraditional Health Insurance
Coverage for Minor IllnessesLimitedComprehensive
Emergency CoverageExtensiveStandard
Preventive CareUsually IncludedUsually Included
What Is Catastrophic


Catastrophic health insurance is a cost-effective option for those in good health and on a tight budget, focusing on protection against significant, unforeseen medical events. It’s essential to weigh the low premiums against the high deductibles and consider your health needs before choosing this type of insurance. This plan might be the right choice for you if you’re looking for a safety net for emergencies while managing lower ongoing costs.

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Frequently Asked Questions

Are high-deductible health plans good?

High deductible health plans (HDHPs) can benefit some individuals, offering lower premiums and access to Health Savings Accounts (HSAs). They suit healthy individuals who can manage higher out-of-pocket costs. However, they may not be ideal for those with frequent medical needs or prefer more comprehensive coverage.

Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

Shawn Plummer is a Chartered Retirement Planning Counselor, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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