Considering Dental Insurance? It May Not Be Worth It, according to Rachel Podnos, JD, CFP, a fee-only financial planner with Wealth Care LLC.
1. It’s not a good deal if you don’t use it.
The majority of people who pay premiums for dental insurance far underutilize it. The average person doesn’t require regular dental services beyond two cleanings per year, and the national average cost for a cleaning alone is around $90. Dental policy premiums can range from $150 to $600 per year, with an average of approximately $360. If you go to the dentist only twice a year for cleanings, you will likely save money by simply paying for the cleanings out of pocket.
You might wonder, isn’t this just like health insurance, in which I’m also paying premiums but seeing a doctor only for annual checkups? Well, with health insurance and auto insurance and homeowners insurance, you are paying premiums to insure yourself against the high cost of catastrophe. If catastrophe strikes and you do incur significant medical bills, you pay only your deductible and a small fraction of the expenses above that amount; your insurance pays the rest. But that’s not how dental insurance works — which leads us to the second reason dental insurance may not be worth it:
2. It may only be a marginally good deal if you do use it.
With dental insurance, you pay a yearly premium — say, $360 — which gets you a maximum dollar amount of coverage of $1000 to $2,000 per coverage year.
You may have a deductible to pay before coverage kicks in. After you’ve met it, your insurance pays a percentage of your dental costs; you pay the remainder, called coinsurance. The coverage stops entirely when the insurance company’s payout reaches that maximum benefit amount. Beyond that, you’ll pay 100% of your costs out of pocket. And the two annual cleanings often “included” in a plan count toward your max.
In addition to your benefit is limited to a maximum of about $1,000 to $2,000, you’ll be trading away the potential to pick your dentist of choice (and location) and perhaps negotiating a price, all for the benefit of saving a few hundred dollars. Even for routine dental issues, many of the best dental practices don’t accept insurance at all. By signing up for this coverage, you may be limiting your care to dentists you won’t like.
Considering all this, while it is possible that having dental insurance could save you money, it is also totally possible that you would be better off paying for your care out of pocket. Take a good look at the benefits of dental insurance policies and do some rough math to decide whether it will likely be a good deal for you, rather than just assuming it is a good idea because it is insurance.
As a courtesy to our patients, we will electronically file your insurance and help you maximize your benefits. Although we can not guarantee what procedures your insurance company will decide to cover, we will be your advocate and submit all supporting documentation in a timely manner. Jennifer has a very reliable track record and can answer your insurance questions and concerns