Is health insurance premium changed on renewal?
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Following the pandemic, there has been a significant increase in demand for good health plans as more and more people have realized the significance of having a health insurance. The swift renewal process and the impending change in the costs of premiums are two things that current policy buyers should be aware of regarding their health plan. This blog will go over one of the most important aspects of any health insurance policy: the premium.
Why Does The Premium Amount For Health Insurance Increase From One Year To Another?
Any individual who has had health insurance for a long period of time must have noticed that the premium amount for health insurance keeps increasing from one year to the other. This is majorly because of inflammation, and nobody can escape the effects of inflammation and health insurance policies are no exception.
Anyhow inflation is not the only aspect that can be blamed for the increased premium amount for health insurance. The increase in premiums especially in India keeps rising because a majority of people suffer from health issues that arise out of lifestyle disorders. In addition to these other factors including lifestyle habits, age, health condition and so on contribute to an increased premium amount of health insurance policy at the time of renewal.
Top Contributors To Increased Health Insurance Premium
In addition to inflation, there are many factors that contribute to the increased premium amount for health insurance. While certain factors are beyond human control, there are still some aspects that can be kept under check. You might want to learn elaborately about the factors that directly influence the increase in the premium amount of health insurance.
- Inflation in the Healthcare sector
Inflation not only affects the cost of livelihood for an individual but also has a massive impact on the healthcare sector. Healthcare expenses that include medical costs, hospitalisation, diagnostic costs, surgery costs and so on keep increasing with the passage of every year. In order to provide proper coverage to the insured, the insurer is left with no choice but to increase the premium price.
- Increase in Age
Age plays an important factor in determining the premium amount of the policy as with age health problems also make their way. With age, the body begins to replenish and there are high chances that one would be faced with a number of health issues. This results in an increased possibility of claims by the insured. This is why the insurance company is likely to charge a higher amount as a premium.
- Coverage requirements of the insured
There is a high chance that the requirements of the insured will change with the passage of time. The responsibilities and health condition of an individual are most likely to be changed with the passage of time. This will impact the health insurance policy requirements as well. An individual in this case may switch to a floater plan or get an add-on to their existing plan.
Therefore, the coverage will change and so will the premium amount of the coverage. This is because the new policy would need a higher sum of money to provide effective coverage and thus the premium amount will change.
- Claim History
In some insurance plans, the premium amount is directly affected by the claim history. In some cases, the insurer increases the premium amount on the basis of the number of claims that are made in the past. The premium amount in this case is determined by the amount of the claim made within a year. This is not the case for all health insurance claims but only some of them and so there is always an option to shift to insurance policies that do not increase premium amounts based on claims.
- Health Condition of the insured
Some insurers also take into account how well you have been taking care of yourself and taking shielding measures to maintain your health. Many Indian health insurance companies value your efforts to stay healthy through general wellness programmes and precautionary healthcare.
They give you awards for things like quitting smoking, living an active lifestyle, working out regularly, losing weight, and so on. Perks and awards include everything from free health checks to renewal premium discounts.
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