Top 10 Factors that Affect Health Insurance Premium

Age of the Insured

As mentioned above, the age of the policyholder is another major factor that affects the premium of your health insurance. As we age, the possibility of getting ill and hospitalized increases. Hence, most insurers provide an age limit beyond which they do not sell new health policies to individuals. And so, it becomes difficult to get medical insurance for aged people as the risk factor becomes more.

Chosen Sum Insured

Yes, the sum insured (SI) you choose is another factor affecting health insurance premium. The amount chosen as SI is the highest amount which can be claimed against the healthcare expenses. Hence, if the SI is low, it lowers the premium, while if the SI is high, it increases the premium amount. So, in case your total medical expenses go beyond the SI amount, you will have to pay the extra amount from your pocket. Thus, you have to be careful at the time of choosing your SI.

PED or Pre-existing diseases

Your health insurance plan becomes pricey if you suffer from any pre-existing medical condition. PEDs with long term influence on the health of the insured such as diabetes, high BP, etc., are likely to incur extra healthcare charges and bills. Hence, the insurance companies levy high premiums while selling health insurance to people suffering from PED. Thus, the premium of your health policy depends on the severity of your PED condition.

Add-on coverage

Most health insurance companies allow policyholders to include extra coverage called add-on coverage which can be purchased by paying an extra amount of premium. This way, you can personalize your health policy by adding covers like personal accident cover, maternity cover, zero-depreciation cover and so on. Here, you must note that the total premium that you pay for your add-ons under a plan should not be more than 30% of the original premium of your health policy.

Place of residence

Depending on the location you reside, the environmental factors surrounding you vary such as pollution level, climate etc. Further, in India the cost of healthcare varies as per the zone you live in. For instance, people living in metro cities are more prone to illnesses and expensive healthcare treatments, which makes their health insurance expensive.

Your Profession

The amount of risk you face at work will also be considered when calculating your insurance premium. Individuals with safer jobs such as office work will be required to pay less compared to those employed in a construction site or factory that are at a higher risk of injuries or accidents.

Family medical history

If your parents, grandparents or anyone else in the immediate family suffered from diseases like heart ailments, Alzheimer’s or cancer of any type, the insurance company raises the premium stating that you are prone to develop such illnesses later in life.

Lifestyle and habits

If you are following unhealthy ways of life such as smoking, consuming alcohol, chewing tobacco etc., it will definitely influence the premium you pay. This is because being involved in such activities enhances the risk of lung infections and many other diseases. Hence, smokers are charged with a greater premium as compared to non-smokers.

Body Mass Index (BMI)

Obese people or people who are overweight as per their BMI are said to be more prone to developing diseases like diabetes and hypertension. Hence, insurance companies levy higher premiums on people who are overweight.

All the above and other such factors are considered while calculating the insurance premium for your health plan. When you finally decide to buy a plan, you must buy it from a top and reliable insurance company or bank which offers a range of plans with lucrative benefits. Below are some names of insurance companies and banks that are regarded as the best health insurance providers in the country that you can choose to buy your insurance from.