If you’re worried about the rising cost of health insurance premiums every year, we have a great money-saving idea for you. Adopting this strategy allows you to save 20% to 25% on your health insurance premium. The key is the co-pay option. By selecting this, you can significantly reduce your premium amount. Insurance experts suggest that while this option is beneficial for everyone, it is especially advantageous for senior citizens, whose premiums tend to be higher due to increased health risks.
Another effective way to lower your policy premium is to opt for a deductible. This option can further reduce your health insurance premium and make it more affordable.
Let’s understand with an example:
Suppose you have taken a family floater health plan for yourself and your family from an insurance company, with an annual premium of Rs 20,000. If you choose a 20% co-pay, you can easily save Rs 5,000. Additionally, many health insurance companies offer the option of a deductible. With a deductible, you pay a fixed amount first, and after that, the insurance company covers the claim amount. Choosing the deductible option can help reduce the premium.
Difference between deductibles and co-pays:
The amount you pay before the insurance company covers the claim is called the deductible. In contrast, with a co-pay, you pay a fixed portion of the claim amount, which can range from 10% to 20%.
How does deductible work?
Suppose you have a health insurance policy of ₹10 lakh, with a deductible of ₹50,000. If you file a claim for ₹4 lakh, your health insurance company will pay ₹3.5 lakh. You will need to pay the first ₹50,000. In other words, your insurance provider will only cover medical expenses that exceed the deductible amount.
Why Choose a Deductible?
- Lower premium: Choosing a deductible helps reduce your health insurance premium.
- No-claim bonus protection: Opting for a deductible helps build your no-claim bonus, as you will avoid filing claims for smaller expenses.
- Coverage amount: Deductibles help protect your insurance amount when you need it, as fewer claims mean your coverage remains intact.
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