Personal Health Insurance
What is personal health insurance and why do I need it?
Personal Health Insurance (PHI), like many other forms of
insurance, is a means of which people collectively put their risk into the same
pot, in this case it is the risk of having medical expenses. The collective is
usually publicly owned or else is organized on a non-profit basis for the
members of the pool, though in many countries health insurance pools may also be
managed by companies that make money. It is sometimes used more broadly to
include insurance covering disability or long-term custodial or nursing needs.
It may be provided through the government-sponsored social program for
insurance, or from private insurance companies. It may be also be purchased on a
group basis (e.g., by a company to cover some or all of its employees) or
purchased by individuals. In each case, the covered groups or individuals pay
taxes or premiums to help protect themselves and family members from unexpected
healthcare expenses. Similar benefits paying for medical expenses might also be
provided through welfare programs funded by the government or country.
By estimating the broad risk of healthcare expenses, a routine finance structure
(such as monthly premiums or annual taxes) can be developed, ensuring that money
is always available to pay for the healthcare benefits specified in the
insurance agreement. The benefit is administered by a centralized organization
such as a governmental agency, private business, or not-for-profit entity.