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Business News/ Brand Stories / 7 Main Factors that Affect Health Insurance Premiums

7 Main Factors that Affect Health Insurance Premiums

Before purchasing a health insurance policy, you should understand the factors influencing the premium

Health insurance can help by paying for hospitalisation costs or even covering ambulance expenditures. Premium
Health insurance can help by paying for hospitalisation costs or even covering ambulance expenditures. 

Following COVID, people have become more aware of the importance of maintaining their health. More and more people purchase health insurance to protect themselves financially in a medical emergency. 

Health insurance can help by paying for hospitalisation costs or even covering ambulance expenditures. However, before purchasing a health insurance policy, you should understand the factors influencing the premium. 

Factors Affecting Health Insurance Policy Premium

The following are factors affecting health insurance policy premiums:

1. Age

The older you get, the more vulnerable you are to developing diseases. The rationale is that retirees cannot engage in moderate-level exercise due to age-related factors such as joint pain. Their food intake is also restricted due to a weakened digestive system. Given this, the premiums for senior citizen healthcare plans are higher.

On the other hand, young people who go to the gym on a regular basis, have a good sleep cycle and eat a nutritious diet remain disease-free. 

It is advisable to purchase health insurance at a young age in order to keep policy premiums affordable.

2. Medical History 

Previous medical records play an important role in computing premiums. For example, if you have previously been diagnosed with chronic lung disease, given the rising pollution levels, you are likely to catch a lung-related ailment again. Similarly, if you have any pre-existing ailments, such as diabetes or thyroid, you are more likely to file a claim. 

In both cases, not only will your premium be high, but the insurer will also levy a loading charge, which is an additional amount you must pay in addition to the usual premium.

3. Occupation Type

Your health is directly related to the type of job you do. If you work in a white-collar profession that needs you to sit 9-5 in a cubicle in front of a laptop in a busy environment, your chances of contracting a chronic illness are lower. 

However, if your employment requires you to be present at a place such as a mining region, a construction site, or another where the risk of an accident is high or where toxic substances increase the possibility of developing lung or heart disease in the near future, the policy premium will be high.

4. Geographical Location

Consider two people: A and B. A lives in Delhi, known for its high pollution levels and shortage of groundwater in many areas. B, on the other hand, lives in a small town with all the amenities and zero pollution.

In this instance, even if A lives a healthy lifestyle, he is at risk of acquiring health problems due to environmental factors and resource constraints. Hence, the premium for A’s coverage will be higher. 

Not only that, the type of food available in the location also plays a role in premium computation.

5. Body Mass Index

The body mass index, or BMI, is a measure that uses height and weight to evaluate how healthy you are. To calculate this, divide your weight (kilograms) by height (meters).

A BMI of 18.5-24.9 is considered good. Even if your BMI is higher than this range but less than 30, it will have little effect on the premium.

However, if your BMI exceeds 30, you will be classified as obese, and your premium will rise dramatically.

Eat a nutritious diet and limit your carbohydrate intake to maintain a healthy BMI index. Include a modest amount of exercise or cardio in your regular routine, and walk for at least 30 minutes every day.

6. Policy Type

Healthcare plans come in various types. Depending on your requirements, you can choose a family floater plan, an individual health cover, or a senior citizen policy.

The premium for a family floater is higher than for individual plans. However, compared to buying individual cover separately for each family member, the family floater plan is more cost-effective.

Senior citizen plans also have a higher premium since they are designed to cover people over the age of 60 who may already be suffering from a disease or have a high chance of developing age-related illnesses in the near future.

Apart from this, the sum insured and policy tenure also affect the plan. A higher sum insured with 2-3 years of coverage will cost more.

7. Add-ons

Add-ons are additional coverage options you can purchase with your base plan. For example, if you are a newlywed couple, you can include maternity coverage in your regular plan to alleviate the stress caused by the high delivery charges.

If you have a pre-existing disease and are concerned about not being able to use your policy benefits while paying a high premium owing to the waiting period, you can get a waiting period waiver rider.

Likewise, there is critical illness coverage. This rider pays you a lump sum payment with no restrictions on usage soon after you are diagnosed with a life-threatening condition. 


Buying health insurance is a vital financial decision. It provides coverage against many diseases and covers several minor and major expenses associated with treatment. A health insurance premium calculator can give you an accurate idea of how much you need to pay to acquire the policy.

Disclaimer: This article is a paid publication and does not have journalistic/editorial involvement of Hindustan Times. Hindustan Times does not endorse/subscribe to the content(s) of the article/advertisement and/or view(s) expressed herein. Hindustan Times shall not in any manner, be responsible and/or liable in any manner whatsoever for all that is stated in the article and/or also with regard to the view(s), opinion(s), announcement(s), declaration(s), affirmation(s) etc., stated/featured in the same. This information does not constitute a financial advice.

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Published: 24 Apr 2024, 07:50 PM IST
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