Recently, soaring healthcare costs and medical expenses have led to an increased demand for health insurance in India. Thus, health insurance no longer remains an option rather a necessity.
The selection of a health insurance policy comes with premiums, which you need to pay over a defined period. In this blog, we will delve into what premium in health insurance is and the factors affecting it. For those exploring health insurance plans for family, understanding premiums is especially important to balance affordability with comprehensive coverage.
What is a Medical Insurance Premium?
Health insurance premiums are the regular payments you make to an insurance company in exchange for health coverage. Think of it as a subscription you pay for your financial protection that health insurance offers, covering essential medical expenses. These payments can be made monthly, quarterly, or annually, depending on your chosen plan.
What are the Factors that Affect Premiums in Health Insurance?
In India, the premium in health insurance is influenced by several factors that insurance companies consider to assess risk and determine the cost of coverage. These are as follows:
1. Age
Age is a major determining factor in premiums for health insurance. Younger individuals typically pay lower premiums because they are generally considered healthy and less likely to experience serious medical conditions. As you age, the likelihood of needing medical care increases, leading to higher premiums.
2. Medical History
If you have a history of serious illnesses, chronic conditions like diabetes or high blood pressure, or pre-existing diseases. Then, these conditions can increase the premium amount due to health risks. Insurers perceive individuals with these conditions as higher risk due to a greater probability of future claims.
3. Lifestyle Choices
Habits like smoking or excessive alcohol consumption can increase your health risks, leading to higher premiums. These habits are associated with a higher chance of developing serious health issues. Thus, it is better to avoid these habits if you are looking for health insurance plans with affordable premiums.
4. Plan Types and Coverages
The specifics of your chosen plan significantly impact the premium. More comprehensive plans with extensive benefits, higher sum insured, or lower deductibles generally result in higher premiums. Look for plans with a balance between the features and the premium rate.
5. Location
Geographic location affects premiums due to variations in healthcare costs and regulations across different regions and cities. For example, healthcare costs and premiums may be higher in metropolitan areas compared to smaller towns. Thus, location is a prime factor that determines the rate of a premium in health insurance plans.
6. Family Size
If you look for individual health insurance policies, the premium rates will be as per the terms and conditions of your chosen plan. However, for floater policies ( which cover multiple family members under a single plan), the premium increases depending on the number of covered individuals.
7. Deductible
Opting for a higher deductible can lead to lower premium health insurance, depending on the plan. This arises if you agree to pay a larger portion of the costs upfront before your coverage starts. However, if you buy health plans with a lower deductible amount can increase your premium rate for the overall policy.
8. Coinsurance
Similar to deductibles, if you choose a plan with coinsurance, you agree to pay a certain percentage of the cost. Insurance companies generally recommend it to pay after all your deductibles are met. It can significantly influence your premium rate for the chosen health insurance policy.
How to Pay Health Insurance Premiums Online?
Follow these steps to pay your premium online:
1. Visit your insurer’s official website.
2. Log in or register your account.
3. Navigate to the ‘pay premium’ or ‘renew policy’ section.
4. Enter all your policy details, such as date of birth, policy number, and other additional information.
5. Verify the premium amount carefully and check for any additional charges like tax or GST.
6. Choose your preferred payment method like debit card, credit card or UPI.
7. Complete the transaction and save the payment confirmation for future purposes.
Additionally, many insurers now integrate with government health initiatives, making it easier to link your policy with digital health records. For example, you can manage your health details through Abha Card download, which helps streamline medical history and insurance claims.
How to Reduce Your Health Insurance Premiums?
Here are some tips on how to reduce your premium in health insurance:
1. Buy health insurance at a young age, as most health insurance companies offer lower premiums for health insurance plans.
2. Choose plans with a higher deductible or co-payment, as these will provide lower premiums, but you will have to pay more upfront during a claim.
3. Buy family floater plans instead of separate policies, as they will offer lower combined premiums compared to individual plans.
4. Look for plans which offer discounts on opting for policies with longer tenures, such as 2 or 3 years, instead of renewing annually.
5. Utilise your no-claim bonus (NCB) as it can lead to a discount on your renewal premiums without raising the premium.
Conclusion
Having a proper knowledge about any premium in health insurance and the factors that influence them to make an informed decision on choosing a health insurance plan. These factors need to align with your specific needs and financial situation for selecting the best plan.