Insurance for Your Startup

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  • Roy Leban
I think that dental coverage is worthless for individuals and small companies. For large companies, it is a way to provide additional pre-tax benefits. For small companies, it is a way to give the dental coverage provider money. This is because, unlike health insurance, there is no catastrophic coverage.
  • Suppose you pay $10,000 a year for health insurance for your family. Your expected return is a maybe $2000-5000 and the rest of the money cover catastrophes that happen to other people and profit for the company. But, if you have a medical catastrophe that requires major surgery. You might get back $100K or $1M in coverage, making the difference between solvency and bankruptcy -- or life and death.
  • In contrast, suppose you pay $1,000 a year for dental coverage for your family. Your expected return is maybe $700-800, so it seems like a good deal in comparison. But, the maximum return might be only $1,200. If you have a catastrophe which requires many thousands of dollars, you're still stock with the bill. In other words, it's not really insurance.
  • Gary Yngve
  • In addition, dental plans don't have the legal protection of continuous coverage the way health insurance does. Instead of a "cleaning", I get "periodontal maintenance" 3 times a year. This costs more, and dental insurance covers NONE of it until you go past a waiting period, regardless of your previous coverage. Ripoff. I would have been happy if they would have compensated me for just the costs of a cleaning.
  • Just about all dental insurance that I've seen caps per year at $1500. That may have been a good cap 20 years ago. But in Seattle, anon-sketchy dentist would charge probably $2500 for a root canal + crown, maybe more. And again, waiting periods may apply.