The Factors Contributing to the Rise of Health Insurance Premium

The Factors Contributing to the Rise of Health Insurance Premium


Health insurance is crucial to get financial protection against high medical expenses. As such expenses can consume a person’s entire savings, it has become essential to buy health insurance to have a financial cushion. A person can buy individual health care insurance for himself/herself. Also, people can buy family health insurance to get cover for every member of the family.

Family floater policies cover every member of the family under a single plan. Hence, every person becomes eligible for the entire sum insured amount. Therefore, a family floater plan can provide enhanced financial cover to the insured person.

While policyholders get financial cover against various medical expenses, they will have to pay premiums to get health insurance benefits. Let’s take a look at factors that impact health insurance premiums.

Factors that Impact Health Insurance Premium

  • Age

Age is one of the most crucial factors while calculating the health insurance premium. Generally, health insurance companies charge a lower premium to young individuals. This is because the likelihood of young individuals requiring medical treatments will be lower compared to older individuals. Hence, it is recommended to buy health insurance at a young age to lower the premium amount.

  • Medical History of the Applicant

In order to purchase health insurance, the insurers ask for the medical history of the applicants. If an applicant has a pre-existing medical condition, then the insurance company can choose to allow it or not cover it under the policy. Hence, a pre-existing medical condition can have a huge impact on the premium amount.

  • Medical History of the Applicant’s Family

Apart from the applicant’s medical condition, insurers also ask for the medical history of the family. In case the individual’s family has a medical history of any ailments, such as diabetes, heart problems, etc., then the insurance company might charge a higher premium amount.

  • The Applicant’s Profession

Applicants working in a high-risk environment or dealing with hazardous substances are at risk of injuries. Hence, insurance companies will charge a higher premium to such individuals.

  • The Applicant’s Location of Stay

Many insurance providers consider the location where the applicant lives while calculating the premium amount. If the applicant lives in a place that doesn’t have healthy food options or has bad climatic conditions, then such an individual might be charged a higher premium rate.

  • Unhealthy Lifestyle

An unhealthy lifestyle can lead to various diseases, such as heart ailments, diabetes, etc. Individuals who face these illnesses might require medical treatments to recover. Hence, it can lead to a rise in the frequency of claims. This increases the risk for insurance companies, and they consider it a factor while calculating the premium amount. Thus, applicants with an unhealthy lifestyle might have to pay higher premiums.

Buy Health Insurance to Get Financial Cover Against Medical Expenses

Medical expenses are rising significantly and can consume your entire savings if you don’t have protection against it. Hence, buying a health insurance plan is important to financially secure yourself from high medical expenses.