One news item that often makes headlines scary is - health insurance premiums are on the rise and can go up even further. Health insurance is crucial as healthcare costs are rising rapidly. At the same time, health insurance premiums are rising too.
This is largely due to medical inflation and the rising hospitalisation costs. Insurers have to catch up with the rising costs, and hence the premium hike. “While it’s true that premiums are increasing, we’ve seen that 53 per cent of customers experience an inflation rate of less than 10 per cent and continue to renew their policies without making significant changes. Only five per cent of overall health insurance customers ultimately face an inflation rate above 30 per cent due to largely age-related factors. The rest can mitigate the price rise through migration to new-age and affordable plans or opting for deductibles and limited network coverage,” says Siddharth Singhal, head, health insurance, Policybazaar.com
However, renewal rates have increased by nearly 10 per cent in the last two years, showing a positive trend, despite higher premiums.
What You Should Do
“To manage rising premiums without compromising coverage, insureds can explore different options such as opting for top-up plans, increasing the deductible value, making use of the wellness benefits, etc. It is also important for the policyholder to review their coverage needs timely to avoid unpleasant surprises later,” says Rakesh Goyal, Director, Probus.
Furthermore, leveraging different discounts offered by the insurer and maintaining a healthy lifestyle can help in managing costs efficiently.
Also, to address this and combat medical inflation, insurers are offering plans that automatically increase coverage amount over time while reducing the cost per unit of coverage, ensuring long-term affordability as medical costs rise. “A key USP of these plans is the inclusion of a cumulative bonus that automatically increases the sum Insured every year, regardless of any claims made. This bonus can increase the policy's total sum insured by up to 7x, 10x, or even more over a defined period,” says Singhal.
One can also go for a limited network of hospitals that can help save up to 15 per cent on premiums, providing access to quality care at a lower cost.
Consider Switching
If you are not satisfied with your health insurance policy, you can port it to another policy. The choice completely depends on individual needs. Switching the insurer or modifying the existing policy can be helpful only if the new policy offers better features or comparatively lower premium rates than the existing ones, without losing the accrued benefits. “However, before making the switch it is recommended to review the existing policy and optimize the coverage by either adjusting the riders or sum insured of the policy,” says Goyal.
