Dental insurance - The Worst Coverage that Everyone Wants!

As an insurance agent, people ask me for dental insurance constantly.  Sometimes i get the feeling people want dental insurance more than medical coverage.  As an agent who would get paid more for selling more dental insurance to my clients and prospects, I often recommend LESS dental insurance or sometimes for my client not to purchase dental insurance AT ALL.  Why?  Let me count the reasons why I don't like dental insurance, and why I think you may be disappointed with dental plans:

Discount dental plans
Here is a plan that isn’t really a plan at all.  You are led to believe that you are buying an insurance policy, but instead you’re buying a “discount.“ But you’re not really getting a discount, here is how these programs work: you pay a fee to a third party, that third party gets to keep most of your money, in return you receive a list of dentists who will “accept” a reduced cost for only a few treatments.  When you visit those dentists on the list, to compensate for their reduced fees, you are billed for services not covered by the discount plan.  

Waiting periods
When purchasing coverage on the individual market, meaning you are not purchasing coverage through an employer, then your dental plan will have waiting periods; A six month waiting period before the plan will cover basic dental work like fillings, and twelve months before the plan will cover major dental services like crowns and root canals.  If you do the math, paying a dental insurance company for twelve months before you can get the treatment you really want doesn’t make financial sense. A plan with waiting periods means your “swapping dollars” with the insurance company, or maybe even getting less out of the plan than you are paying in.

Low Coverage limits and 50% for the most expensive dental work
Just when you need dental coverage the most, you are in severe pain and need a root canal followed by a crown, your dental insurance plan has limits on how much they will pay AND most plans only pay 50% toward your major dental claims.  This means that you could be responsible to pay several thousand dollars out-of-pocket to get the treatment you want and need... which ultimately means you cant afford it at all.

Dentists don't like it
Because of the reasons mentioned above, most dentists do not like dental insurance plans or dental insurance companies.  In fact, many dentist view dental insurance companies as an “enemy” to their patients and practice.  Dentists scheme of eliminating dental insurance companies all together by creating their own in-house dental membership plans, plans which promote direct monthly payments to the dentist instead of the insurance company.  Also, many of the best dentist choose to accept very few, if any, dental insurance plans. This is another reason why its so hard to find a good dental plan as many of the top dentists in your area may not accept any of the plans you can purchase.

When does it make sense to buy dental insurance?

1. When its offered by an employer, and especially when the employer is paying all or a portion of the monthly costs.  Group dental plans don't have waiting periods and the monthly premiums can be deducted prior to payroll tax with holdings which makes them even more affordable.
2. It usually makes financial sense for families to buy dental insurance when all family members are seeing a dentist twice a year for  cleanings because the dental plan should pay 100% for preventive services, exams, and annual x-ray.

Summary
I sell a lot of dental insurance, it seems to be in high demand these days, and because I know its limitations, I will usually recommend a plan that is very affordable and has a large list of dentist that accept the plan.  After that, I often recommend a “supplement” program in addition to stand-alone dental called the Savings Group.  I created the Savings Group to help my clients pay for the dental care they need and services their insurance plan wont cover. The Savings Group gives my clients access to funds they can use right away so they can be confident the next time they visit the dentist they can afford the care the dentist recommends.   The Savings group allows my clients to spend less on insurance while also avoiding risky and expensive dental financing options like CareCredit.