How is Your Health Insurance Premium Determined?

Before we jump into understanding the key factors impacting your medical insurance plan premium, let us discuss the top benefits of health insurance in short below.

One of the primary benefits of a health insurance plan is financial cover provision for hospitalisation expenses. This reduces the financial burden on individuals for getting necessary treatments.

Many insurance providers offer the policyholders with annual health check-up facility to ensure their well-being is monitored regularly.

Popular health insurance providers like Tata AIG offer restoration benefits to the policyholders.

Most health insurance plans cover pre and post-hospitalisation charges for the patient and also cover in-patient treatments if the number of days required for treatment surpasses the 1-day limit.

According to Section 80D of the Income Tax Act, policyholders can benefit from a deduction on the premium of around ₹25,000 for individual plans annually and approx ₹5,000 for health check-ups.

A majority of insurance providers offer a range of medical insurance plans to cater to different needs and preferences of individuals.

Let us discuss some of the key factors impacting health insurance premiums below.

Your Age & Gender

Based on your age, the health insurance premium is increased. The main reason behind this is that with growing age, the potential health issues also increase, resulting in a higher need for medical treatments. Therefore, anyone above the age of 40 is charged a higher premium.

Moreover, females are charged a lower premium in comparison to men. The main reason is that there are many health conditions that affect men more than women.

Type of Plan

Tata AIG offers medical insurance, individual health insurance plans, family floater plans, top-up health insurance plans, and group medical plans. Based on the type of coverage you require, the policy type will change, and so will the health insurance premium.

An individual health insurance plan with no add-ons will be less expensive as compared to a comprehensive health insurance plan with multiple add-ons.

Lifestyle

The health insurance premium for an individual who is a smoker and consumes alcohol regularly will be higher as compared to someone who does not. This is because all your adverse lifestyle choices increase the risk of health issues, indicating a higher need for treatments in the future.

Critical illness, Covid-19, and personal accident covers are some add-ons available with Tata AIG health insurance plans. Combining any add-on with the base health insurance plan will increase the premium value. Moreover, depending on the number of add-ons you choose, the health insurance premium can increase further.

Medical History

Pre-existing medical conditions and a family history of the policyholder also impact the premium charged. For instance, if someone has a family history of heart problems or has previously undergone a few heart surgeries, the chances of them getting affected by the same issue increase. For such people, the premium charge for a health insurance plan will be higher.

Geographical Location

Different cities and states in India have varying medical costs and diverse accessibility to hospital facilities. Based on this, the geographical location of the policy buyer can impact the health insurance premium.

Policy Co-Pay and Deductibles

Most health insurance plans offer the option of choosing the deductible and co-pay value to the policyholder. Both these options reduce the premium value provided by the insurer as a part of the expenses is borne by the policyholder.

The differentiating factor between co-pay and deductibles is that co-pay is a fixed amount, and deductibles are a percentage that can vary based on medical treatment expenses.

Even though the above factors are pretty straightforward to understand, calculating a close estimate of the premium value for a health insurance plan of your choice can be difficult.

To help with the same, Tata AIG offers an online health insurance premium calculator to help with a precise estimate of the premium value in a few quick steps. The best part is you can do it from the comfort of your home, making it easier to compare different health insurance plans before the final decision.

Here is how you can use our health insurance premium calculator.

Visit Tata AIG's official website.

Go to the landing page for Health Insurance available under the “All Products” option from the top bar.

Once a new window opens, enter all the details requested on the page. This includes personal details like location, address, PIN code, name, etc.

For the next step, select the number of people you wish to insure under one plan.

If you choose any of the family health insurance plans, you will also be required to enter the number of family members you wish to add under one plan.

Once completed, add the policy coverage you require and select the number of add-ons you wish to combine with the health insurance policy.

Enter any other necessary information requested on the screen and click the “Calculate” option to proceed.

Based on the information you enter above, a premium estimate will flash on the screen to help you plan and compare different options.

Please note:

The health insurance premium calculator will provide you with an accurate estimate of the premium value for the chosen health insurance plan. The value can vary depending on the choice of insurance provider you select and the health insurance plan you wish to purchase.

To summarise, numerous factors impact the health insurance premium, and therefore, it is crucial to understand the value of each of these factors to determine the closest estimate.

Moreover, given that age plays a vital role in determining the premium value, purchasing health insurance from Tata AIG as early as possible is highly recommended to enjoy more affordable health insurance premiums.