In India, demand for insurance goods, particularly health insurance, has increased dramatically after COVID-19. With constant healthcare inflation, if you haven’t purchased health insurance for yourself, it might be time now! We’ll go through one of the most significant parts of every health insurance policy: the factors that determine its premium.
The Most Important Factors Affecting Your Health Insurance Premium
A health insurance premium is a fee you pay to the health insurance company in exchange for financial protection in the event of a medical emergency. This premium varies from person to person, depending on a variety of circumstances. However, not all health insurance carriers use the same procedure when calculating your premium cost. Consider the following considerations when determining health insurance premium rates:
Pre-Existing Conditions
PED are diseases for which a person was diagnosed, treated, or counselled within 48 months of acquiring health insurance coverage. If you have high blood pressure or a thyroid disorder, it will be deemed a pre-existing condition.
The whole insurance industry is based on risk assessment and probability. People who already have major health problems are more prone to develop linked health problems later in life. As a result, such people are more likely to file claims.
In such instances, no insurance would gladly assume a risk. In fact, most insurers refuse to cover pre-existing conditions. However, in order to give much-needed financial security, they would raise rates for persons with pre-existing conditions. Pre-existing disease coverage will almost certainly be required by your insurance.
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Insured Amount
The sum insured varies by policy. This is the most you can claim from your insurer in the event of a medical emergency. Assume your policy’s SI is Rs. 5 lakhs. If your hospitalization bill is Rs. 7 lakhs in an emergency, you can only claim Rs. 5 lakhs.
The smaller your SI, the lower your premium. Health plans with a bigger sum insured will be more expensive because you can claim considerably more from the insurer in the event of a medical emergency. It’s usually a good idea to go for a greater sum insured because medical crises are unexpected, and you can end up paying out of pocket if something serious happens.
BMI is too high
Body Mass Index, or BMI, is a popular metric for determining a person’s fitness. A high BMI indicates a higher risk of developing health concerns such as heart disease, respiratory problems, joint discomfort, and so on. Customers with a high BMI are considered high-risk insurance buyers who may acquire health problems sooner or later.
To encourage policyholders to keep healthy, numerous health insurance providers offer discounts and benefits for maintaining an active lifestyle, obesity control, and other general wellness programmes.
Age
There’s a reason our twenties and thirties are referred to be the “golden years” of our existence. We are in excellent health at this age and have no major health concerns. However, after this, we begin to have health issues, and our bodies struggle to recover as quickly as they used to.
When you acquire health insurance early, you save money because you are less likely to file a claim. However, most insurers raise premiums once you reach the age of 45. In fact, most insurers do not give plans to persons beyond a particular age and instead offer specific plans with higher premium charges to seniors.
Smoking
It is harmful to one’s health and raises the chance of a variety of health problems, including lung disease, infertility, and cancer. Because smokers are more likely to file a claim, insurers charge a higher premium for their health insurance policy.
Other Considerations
There are numerous more factors that might have a significant impact on your premium expenses. Before purchasing any health insurance plan, keep these factors in mind.
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Now it’s your turn
It’s critical to understand how insurance costs influence your plan selection and financial planning. Choose a plan with a manageable premium that you can pay annually (including typical inflation costs) to ensure that you are covered in the event of any financial emergency.
