- Date : 14/03/2023
- Read: 4 mins
Keeping in mind the current society and variety of diseases emerging, health insurance is important in each individual’s life. Increasing demands for health insurance have also increased the price range of health insurance premium outgo. But there are a few ways available that can save on insurance premium outgo.
Ways to save on health insurance premium outgo:
Health insurance is a type of insurance that covers the cost of medical care. It helps pay for the cost of hospitalization, surgeries, doctor visits, prescription drugs, and other medical services related to health. This type of insurance is especially important in India because it helps protect individuals and families from the high cost of medical care. By having health insurance, individuals and families are able to access health care without worrying about the financial burden associated with it. This can make a huge difference in the lives of people in India, especially those who lack the resources to pay for medical care.
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Insurance premium outgo in India is on the rise. According to data from the Insurance Regulatory and Development Authority of India (IRDAI), the total premium collected by India's insurance companies in 2018-19 was ₹5.52 trillion, up 10.2% from the previous year. Of this, life insurance accounted for ₹3.17 trillion and general insurance accounted for ₹2.35 trillion. Life insurance premiums account for the majority of insurance premium outgo in India, with the most popular policies being term insurance, endowment plans, and ULIPs. Health insurance premiums are also on the rise, with the government's Ayushman Bharat Yojana being a major driver of growth in this sector.
Insurance outgo in India is likely to grow in the coming years as more people become aware of the importance of having insurance and the government continues to promote insurance policies with the aim of providing personal financial security to the population. In this light, the health insurance premiums will also be increased, but there are a few ways that an individual can consider to save and finance their health insurance policy premium outgo:
1. Choose a health insurance plan with a higher deductible: Opting for a health insurance plan with a higher deductible can help you save money on your health insurance premium. A deductible is the amount you need to pay out of pocket before your health insurance plan starts covering the cost of your medical expenses. By choosing a plan with a higher deductible, your monthly premium amount will be lower, as the insurer will be taking on less risk.
2. Consider a Family Floater Policy: A family floater policy is a single health insurance policy covering the entire family. If you have a family of four, you can choose a family floater policy instead of individual policies for each family member. This will help you save on the premium amount as the insurer will be covering all of the members under the same policy.
3. Avail Tax Benefits: Under Section 80D of the Income Tax Act, you can avail yourself of tax benefits for the premiums you are paying for your health insurance.
4. Opt for Network Hospitals: If you opt for a health insurance plan with a network of hospitals, the premium amount you pay will be lower. Network hospitals are those hospitals that have a tie-up with the insurance policy company and offer discounted rates for insured patients.
5. Increase Your Policy Term: You can also save on the premium amount by increasing the policy term for your health insurance plan. A longer policy term will mean that you are paying a lower amount as the insurer will be able to spread the risk over a longer period of time.
6. Use the No Claim Bonus: If you did not file any claims in the previous year, you are eligible for the No Claim Bonus (NCB). This is a discount that the insurer provides for not making any claims in the previous year.
An individual can save on their health insurance policy premium outgo by choosing the right plan, choosing a policy plan with higher deductibles, keeping in mind the tax benefits, using the employer’s health plan for groups, and then finalizing the deal.