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Can you lock the premium in your health insurance policy?

 

Getting a health insurance policy has become necessary in today’s time of increasing medical costs. With a health insurance policy, one can access quality medical care without burning a hole in one’s pocket. But, not everyone is keen to buy a health insurance policy. This is influenced by the view that you do not require health insurance coverage if you are young or healthy or both.

In India, 400 million people have no health insurance, which is about 30 percent of the population. There can be a multitude of reasons for not having health insurance coverage, affordability, lack of awareness, complex nature of health insurance policies, limited coverage in policies, absence of tailor-made products, or negative experiences with health insurance companies. 

A significant factor that discourages individuals from buying health insurance is that the premium amount of the policy increases yearly. The proportional increase in the premium amount with every annual renewal is a major conundrum that influences the decision to buy a health cover. The common complaint of prospective policy buyers and existing policyholders is why should the premium increase even if there is no claim in a year. 

The increasing premium amount factor discourages many Indians from buying a health insurance policy. Policyholders wish that the premium amount is the same and continue to be so as long as there is no claim. Insurance companies on their part justify the increase in premium amount with reasons like an increase in healthcare costs, additional coverage terms, medical inflation, increasing age of the policyholder, change in regulations, claims history, or administrative expenses.

The pain of increasing premium is particularly felt by senior citizens as on the one hand they are subject to maximum increase in premiums due to their advancing age and on the other hand they usually face a general declining trend in earnings due to their advancing age. This situation creates a double impact which increases their financial burden.   

Policyholders now have options to avoid an increase in the premium amount, such as taking a health insurance policy for a tenure longer than a year. They can take a three-year policy where the premium remains constant for three years and get a discount upfront (up to 15%) when they buy the policy. The premium will not increase due to inflation or age in this long-tenure policies.

Another option is to choose a co-pay deductible option where the policyholder agrees to bear a part of the covered amount before filing a claim. Another option is to change the insurer using the portability policy. However, these options may not be suitable for every policyholder.

Realizing the increase in the premium amount as a pain point for those considering the purchase of a health insurance policy, insurance companies are now coming up with new features in policies to help the premium remain constant.

One such feature is giving the policy buyer the facility to fix the premium at the age at which he buys the policy. The premium will be based on this age till a claim is made. This will continue till a certain age set by the insurer. Once a claim is made, the premium will be charged as per the age of the policyholder.

The option to lock the premium on certain conditions can be a blessing because paying the premium will not create a financial dent with every claim free year because the insured is assured of the same premium amount as long as he has made no claim in that particular year.

This facility will encourage younger people to go for a health insurance policy because they can put aside the worry of paying an incremental premium amount with every passing year.

With increasing medical expenses, everyone must go for a health insurance policy. Health insurance policies that provide the facility to lock the premium for a considerable duration will encourage more individuals to buy a health insurance policy.

If you are considering the purchase of a health insurance policy, the range of features in the health policies of different insurers can leave you confused. It is best to consult an insurance broker who can advise you on the policy most suited to your requirements and has features that will work to your advantage.

 

Contact us for assistance in choosing the health insurance policy with the best features that will meet your requirements.

 

Disclaimer:

Zen Insurance Brokers is an IRDA registered broker that facilitates quick and adequate insurance broking services. We deal with only regulator-approved products of insurers. We do not underwrite the products.





 

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