Due to the obvious escalating expense of medical treatment, the number of people purchasing a health insurance policy has increased significantly in recent years. People are purchasing insurance for their entire family to guarantee they have a financial buffer in the event of an emergency. Health insurance not only protects you during difficult times but also provides tax benefits.
Insurance firms often perform a detailed review of your health profile when approving your insurance application. They fix the premium prices based on their review.
Here are the Factors that Influence Health Insurance Premiums
- Age and gender
Insurance companies often follow the rule of thumb: the older you are, the higher your premium cost. This is because those over the age of 40 are more likely to suffer from an ailment that will result in a claim. As a result, it is important to purchase health insurance at a young age to have complete coverage and greater benefits at a low rate. In addition, most insurance firms charge women lower premiums.
- Pre-existing diseases
People who have pre-existing illnesses are more likely to file a claim, so insurance firms charge a higher premium to cover that risk. However, most health insurance policies cover pre-existing conditions after 2 to 4 years of coverage, increasing the likelihood of filing a claim.
As a result, candidates with pre-existing conditions such as high blood pressure, thyroid disease, or diabetes face a higher risk of rejection or paying higher rates.
- Medical history
The amount of your premium is determined by your previous medical records. Your premium will be higher if you have a history of illness or if you have a pre-existing ailment. However, if you have never been sick and have lived a pretty healthy life, your premium will be lower.
- Type of health insurance policy
The cost of premiums varies according to the type of health insurance coverage you select. When compared to individual coverage, a group health insurance policy has a lower premium. Additionally, if you have purchased add-on covers, your premium will rise. Individual or group insurance has cheap premiums, whereas family floater insurance has high premiums. Again, policy terms change from one company to the next.
- Lifestyle and habits
If you smoke or drink alcohol regularly, your insurer may refuse to provide you with health insurance. However, some medical insurance carriers will cover such a risk in exchange for a higher premium cost.
The negative consequences of alcohol and cigarette consumption last longer. As a result, people who abstain from alcohol are more vulnerable to subsequent ailments and are more likely to file a health claim. Because they are more likely to develop catastrophic conditions such as cancer or kidney failure, insurers charge them higher premiums or deny coverage.
- Add-on covers
In health insurance, an add-on is a supplemental or optional coverage that a policyholder can add to a base policy. Add-on covers, which provide benefits in addition to the standard health insurance policy, play an important role in offering further protection at a cheap additional premium price. The purchased add-on covers cost more than the policy, resulting in greater premium charges.
- Policy duration
The duration of your coverage is also significant. The premium will be lower if you buy a policy with a longer-term. This may not be the case for a shorter-term policy.
The health insurance premium is a set amount that you must pay to receive the benefits of a medical policy. Your lifestyle, in addition to the coverage type, sum assured amount, and other aspects are important. You must have recognised that by purchasing a policy at a young age, you can get a better deal and properly insure your future.
Author Bio: Smriti Gala works as a Digital Marketing Manager with Coverfox. As her life turned upside down when COVID severely afflicted her family members, Smriti decided to dedicate her expertise towards informing and educating the masses about the importance of health insurance. When she is not actively writing enlightening content, our ‘monk marketer’ likes to meditate, meet new people and explore less travelled territories.