Opting a “Longer Policy Term” Health Insurance Plan
The cost of health insurance coverage depends upon your age, medical condition, city, and budget. The premium for the health insurance policy might refrain you for opting an adequate sum insured or deferring your decision to buy.
The usual health insurance policy is basically an annual insurance policy which needs to be renewed yearly to avail its benefits and coverage on a continuous basis. But there are insurance companies which offer a health insurance plan for a policy term of 2 years and 3 years respectively.
BENEFITS OF OPTING A“LONGER POLICY TERM”:
Buying a policy for a longer policy term will allow you to avail good discounts on the premium and a wider policy coverage. An insurance policy with longer policy term will enable insurance companies to save on administrative costs of issuance and renewal. Also, the company assumes you to be a loyal customer and offer you a premium discount for staying with the same insurer for more than just a year.
Longer policy term wipes out the probability of your health insurance policy getting lapsed due to non renewal of the policy contract after a period of one year. Failure to renew may result in deprivation of benefits like “No claim bonus”. Discontinuation of health insurance policy due to failure of active yearly renewals also results in discontinuation of the waiting period term of pre-existing diseases which hampers the inclusiveness of pre existing diseases under your health insurance policy.
The discount on opting a policy term for more than a year may range between 7% to 13% on the base premium.
DISCOUNTS OFFERED BY VARIOUS INSURANCE COMPANIES:
Care Health Insurance Company offers 7.5% discount on premium for buying a Health plan for 2 year policy term and 10% discount for a 3 year policy term.
Example: Rahul who is 30 years of age, opting for a sum insured of Rs 5 Lakh under Care Health Plan will have to pay Rs 6,065 annually. Next year to renew his health insurance plan he has to pay Rs 6,065 (assuming no change in the premium amount by the insurer).So the total premium cost for 2 years is Rs 12,130.On the other hand ,if Rahul opts for a 2 years policy term at the inception, he has to pay Rs 11,220 after a 7.5% discount on premium.He saves Rs 910 annually (Rs 12,130 – Rs 11,220) Further, if a person opts for a 3 year policy term, he has to pay a total of Rs 16,375 after getting a 10% discount on premium.
Refer below for more such illustrative cases:
Apart from getting a discount on premium for a longer policy term, the policy will insure you for a wider span and will shield you from any revisions in your policy conditions at renewal. Many people tend to forget the annual renewal of their health plan which may lead to losing of benefits like No Claim Bonus and waiting period timelines.Thus, act smart and buy smart by knowing insightful hacks to save on your “Health Insurance” premium.
Keep watching the space for more insights on saving your Health Premium!