What Happens if you have two or more Insurance Policies at the same time?
Coordination of Benefits
Benefits When You Have Coverage under More than One Plan
When Coordination of Benefits Applies
This coordination of benefits (COB) provision applies when a person has health care coverage under more than one Plan. Plan is defined here.
The order of benefit determination rules below govern the order in which each Plan will pay a claim for benefits.
The Plan that pays first is called the Primary Plan. The Primary Plan must pay benefits in accordance with its policy terms without regard to the possibility that another Plan may cover some expenses.
The Plan that pays after the Primary Plan is the Secondary Plan. The Secondary Plan may reduce the benefits it pays so that payments from all Plans do not exceed 100% of the total Allowable Expense. Read the rest the 7 page explanation
References & Links
model laws 50 pages drafted by the National Association of Insurance Commissioners (NAIC)
Brochures & Information on how
Medicare Guide to Rx Coverage Publication 11109 See Section 4
Our website on Medicare Rx Drugs
Publication 02179 Guide to who pays first
Our webpage on Medicare dual coverage
Medicare Coordination of Benefits Agreement Index Coordination of Benefits Agreement CMS.Gov
More Explanations of COB
Health Care Reform Dependent Coverage vs Spousal Coverage
How about an HSA (Health Savings Account) rather than buying extra policies?
There might be some cases where a COB provision is not allowed – like HIPAA policies for when COBRA ends.
Individual Plans cannot have this clause per CCR §1300.67.13 b 2 d BUT, they might require that you cancel other coverage. Blue Cross EOC Page 5
With COBRA protections and HIPAA availability when you lose Group Insurance, it probably is no longer necessary to keep an individual plan, “just in case.” The extra premium, would probably be better spent on Life or Disability Insurance.
Life Insurance does not have a co-ordination of benefits clause. They will ask on the application though if you have other coverage to prevent over insurance and to make sure there is insurable interest.
See also Balance Billing
What if your doctor charges more than the negotiated rate?
Subrogation if you get in an accident and someone else can be sued
Tools to Read a Statute
Our webpage on Plain English, jiggery pokery and contract interpretation