A health insurance plan covers you against the medical expenses you incur for the treatment of many major illnesses. When buying coverage, it is quite important to understand what is a health insurance premium and how it is determined. To help you with the same, here is everything you need to know about health insurance premiums.
Health insurance premium meaning
Your health insurance premium is the amount of money you are required to pay for buying a health insurance policy and keeping it active. You can either pay a monthly premium or a yearly premium for your health insurance. Furthermore, the coverage of your is directly proportional to the premium you need to pay to buy the insurance policy. If you include various riders such as critical illness cover or room rent waiver in your health insurance policy, the premium you need to pay will also increase.
What factors affect the premium of your health insurance policy?The health premium you need to pay to buy your insurance policy depends on the following factors:
Your age, marital status, and gender play a vital role in determining the premium of your health insurance policy. Typically, people who are young are charged lower premiums. Your area of residence also affects the premium of your health insurance policy as insurers believe the climate and standard of living have a significant impact on the susceptibility of an individual to fall sick.
If there are multiple health hazards associated with your job profile, the premium of your health insurance policy will also probably be higher. This is because working in certain fields – like construction – can possibly make you susceptible to fall ill or getting injured.
Your medical history
Your medical history plays a vital role in determining the premium of your health insurance policy. If you have pre–existing ailments, the insurance company would probably charge you a higher premium for your health insurance policy. Insurers also check if you have a habit of smoking. Since smokers are quite vulnerable to lung and heart diseases, they are charged relatively higher premiums.
If you have a (Body Mass Index) BMI that is considered apt for your age and height, you are charged relatively lower premiums than a person who has an above or below average BMI. This is because abnormally high or low BMI indicates that your body fat percentage is at unhealthy levels. Having a high BMI indicates fatness, while low BMI indicates a lack of proper nutrients in the body. Both these situations can show that you are at a higher risk of falling ill.
The insurer will also include many other factors while calculating your health insurance premium, such as the sum insured you opt for and the number of riders in your coverage. To get an estimation of the premium you can expect to pay, you can use a health insurance premium calculator.
Disclaimer: The above information is indicative in nature. For more details on the risk factor, terms and conditions, please refer to the Sales Brochure and Policy Wordings carefully before concluding a sale.