Two friends, Nikita and Sneha bought health insurance. And while discussing this over a cup of coffee they realised though they bought the same plan from the same company, the premium amounts are different.
This is not unique to Nikita and her friend. Health insurance premiums are determined factors like age, lifestyle, city they live in etc, and hence, it can differ for each individual.
In this blog, we will talk about the 5 crucial factors that determine our medical insurance premium and the reasons for that.
Here are the 5 most important factors that determine the health insurance premium
#Number 1: It depends on what’s your age:
This is an absolute no brainer. As you grow older, you become prone to more illnesses and hence the medical expenses are much more. The health insurance company will have to cover this risk and that is why you are charged more.
This is true for all insurance companies in health insurance. Unlike term insurance, mediclaim premiums do not remain the same throughout the policy tenure. It might be the same between 18 to 35 but then once you move into 36 to 45, your medical insurance premium will also go up.
#Number 2: Whether you are a smoker
Smoking raises the chances of fatal diseases like heart and pulmonary diseases, asthma and also cancer. Now, if smoking is beyond the limit of 10 cigarettes a day, some health insurance companies might deny the policy, and the others charge extra in healthcare premiums.
Health insurance is sold in good faith, and it is expected that one will declare voluntarily if he/she uses tobacco. If the insurance company finds about it later, then the policy might get cancelled.
#Number 3: Whether you have any pre-existing illnesses
If you have a pre-existing illness, the risk of hospitalisation and medical expenses are more. And the medical insurance company will have to cover this risk.
Now, different health insurance companies deal pre-existing illnesses differently. Some put a waiting period or a co-payment condition for it, while some increase the medical insurance premium. Or it can be both.
If you have any pre-existing illnesses declare them while purchasing the policy. If it is discovered by the health insurance company later or during the treatment, then the claim might get rejected.
#Number 4: Whether its individual or floater policy
A floater policy provides health insurance cover to the entire family. And since it covers more than one person, the chances of hospitalisation also increases. Health insurance companies will cover these expenses. So, the premium amount is also more.
For example, if you have a Rs 10 lakh floater policy, its premium amount will be more than Rs 10 lakh individual policy..
#Number 5: Which city you live in
The medical expenses are different in different cities. For example, the hospitalisation expenses for cities like Delhi or Mumbai will alway be more than smaller cities. Hence, the mediclaim policy premium amount will also be more.
While buying a health insurance policy, offline or online, it is important to declare which city you live in, which may not be your permanent address.
There are other factors like – what rider you are taking, facilities included in the policy etc. – that are also considered by the insurance companies while calculating the policy premium. But, these factors matter less than the things like your age, lifestyle, city, pre-existing illnesses etc.
While buying a health policy, it is important that you reveal all relevant information correctly. Declaring these informations, like pre-existing illnesses or whether you are a tobacco user, may increase the premium amount, but it will ensure that your claim is not rejected.