With Health Insurance Premiums on the Rise, Here are Smart Ways Policyholders Can Save
As health insurance rates rise, you must make wise choices to control costs without forfeiting coverage.
The steady rise in health insurance premiums in India makes it challenging for many individuals and families to afford adequate coverage. According to a survey, 52% of policyholders’ premiums rose by more than 25% last year, with 21% facing a hike of 50% or more. This makes it important to optimise health insurance plans while maintaining sufficient coverage.
Why Health Insurance Premiums are Increasing
Here are the factors driving insurance premium hikes:
- Medical inflation: In India, healthcare costs rise annually at approximately 14%, increasing insurers' expenses.
- Technological advancements: Medical treatments use new and sophisticated technology with higher costs. Insurers pass these charges on to policyholders.
- Increased claim ratios: The unexpected surge in claims over the past few years caused insurers to raise premiums to maintain financial stability.
- Policyholder's age and health status: As individuals age, they are more likely to develop health conditions, which increases the insurer's risks and leads to a rise in premiums.
- Regulatory changes: Any changes in insurance regulations and expansion of coverage mandates can also cause premium hikes.
Ways to Reduce Health Insurance Premiums
Although the cost increases, policyholders can still adopt several strategies to mitigate health insurance expenses. These are:
- Opt for multi-year policies
Consider purchasing a multi-year health insurance policy (for two or three years) instead of renewing it annually. This locks in the premium rate and protects against future hikes.
- Choose top-up and super top-up plans
A top-up or super top-up health plan increases coverage at a relatively lower cost. These help boost the sum insured at a relatively lower premium than buying a separate plan.
- Consider higher deductibles
Another cost-effective way to reduce premiums is to pay a higher deductible. A deductible is the amount you pay out of your pocket before insurance kicks in. However, ensure you have enough savings to cover medical expenses up to the deductible amount.
- Maintain a healthy lifestyle for discounts
Many insurers also offer rewards through discounts or lower premiums for policyholders maintaining a healthy lifestyle. To become eligible for such rewards, consider participating in wellness programmes, maintaining a healthy BMI, avoiding smoking, and getting regular health check-ups.
- Leverage no-claim bonus (NCB)
Insurers also offer a No-Claim Bonus (NCB) when you don't make any claims during a policy year. This bonus is either a discount on premiums upon renewal or an increase in the insured sum at no extra cost.
- Opt for family floater policies
Another cost-effective way is to get a floater policy for families. A floater policy covers all members under a single sum insured without buying individual policies for each family member.
- Regularly review your coverage and riders
Avoid getting unnecessary add-ons or riders, as they often increase your premium and offer limited value. For example, getting maternity riders is unnecessary when you are not planning to have children. Review your policy annually to ensure you only pay what you need.
- Port your policy if necessary
If your insurer has increased premiums significantly or provides unsatisfactory service, you can also consider porting your policy to another insurer with better benefits.
- Opt for higher co-payments
You can opt for co-payment, which means you agree to pay a certain percentage of the medical bill while the insurer covers the rest. Policies with a co-payment option have lower premiums and are a great choice for those who can afford some medical expenses.
Additional Steps to Reduce Medical Expenses
- Use network hospitals for cashless treatment
Cashless health insurance ensures seamless access to better medical facilities at a network hospital during medical emergencies. The insurer directly settles the medical costs with the hospital and saves you from paying out of pocket.
- Compare policies before buying or renewing
Using online comparison tools to evaluate different plans can help you find the best coverage at the lowest cost.
- Invest in preventive healthcare
Preventive healthcare, including regular check-ups, vaccinations, and screenings, reduces the risk of severe illnesses and expensive treatments. This reduces claims and helps in maintaining lower premiums.
Conclusion
With rising health insurance premiums, policyholders must adopt smart, cost-effective strategies to lower costs while ensuring adequate coverage. Opting for long-term policies, using top-up plans, maintaining a healthy lifestyle, leveraging no-claim bonuses, and knowing discounts can all help reduce costs. Additionally, regularly reviewing policy terms, considering higher deductibles, and porting policies when needed can help optimise expenses. By taking a proactive approach, individuals and families can navigate rising premiums without compromising on quality healthcare.
Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales.
Disclaimer: No Business Standard Journalist was involved in creation of this content
Topics : insurance plans
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First Published: Mar 28 2025 | 3:57 PM IST
