The basis upon which the Insurance Premium is calculated

There are N number of policies being sold in the marketplace today. Ranging from life, medical, health, death, marine, fire and much more. The main purpose of every insurance is to provide financial assistance to the insured against the unpredictable happenings of life. All you have to do to buy insurance is, let the insurer know that which kind of policy you want. How much premium you are required to pay periodically | monthly or quarterly. Also, the amount that would be provided by them in case any discrepancy is faced by the insured. To keep the insurance alive, the insured has to pay the agreed premium with the insurance company. Reasons for the Calculation of insurance premium depends upon various important factors.Listed below are some of the important factors that are considered while calculation of Insurance premium:- 

  • Body Mass Index – BMI

One of the important factors to be considered is BMI. It stands for the ratio between the height and weight of the insured. The calculation of premium depends upon the BMI inversely. So, if your BMI rate is unhealthy, there is a natural probability that you can undergo illness. In such cases, the premiums rates go higher. The insurance company has to protect its interest too.

  • Age of the person to be insured 

Age is the topmost basis considered in almost every aspect of life, then how can insurance premium calculations neglect it. If the person to be insured is young and healthy, the premium rates would be lower. If the person is more into older age, the rates of the insurance premium would be relatively higher. This is mainly because an older person suffers through many ailments because of age-related factors.

  • Medical history of the family

We have all heard that some health issues and effectsare transferred within the genes. If there is any history of medical issues going in the family, the premium rates would be witnessed to be double folding itself. This is because ailments like blood pressure, diabetes are generally transferred through family genes. 

  • For a person who is already undergoing some disease 

The premium rates for a person who is undergoing some pre-existing disease would be relatively higher than a completely healthy person. There is a waiting period considered in such cases. The person that has to be insured has to undergo a waiting period first to cover the disease period that is already existing. Now, there are terms and conditions associated with this waiting period too. In case the person wants that his waiting period should be minimised, the rate of premiums would go even higher in that case.

  • Depends upon the lifestyle of the person to be the insured 

The lifestyle of the person is a major basis to be laid down in the frame of calculation of premium. If the person favours alcohol, cigarette consumption, then it is but obvious that the premium rates would be declared higher. As we know, the consumption of tobacco induces cancer, alcohol causes failure of kidneys and other multifunctional diseases in the body. So, considering all these factors, the premium rate would be calculated.

  • Range of plan selected

In case one whole lot of family that consists of 4-5 members is getting insured, the premium rates would be lower for them. If the insurance is going to be done just for a single member of the family, it would cost more. Therefore, the range of the plan that you select makes a major difference.

So these are the most important factors that have to be considered while calculation of the insurance premium. Age, lifestyle, pre-medical conditions play a very crucial role. All the information provided to the insurance company should be authentic. 

After knowing about the basis, let us know that why do we need a premium health insurance calculator: –

  • We know that premium depends upon several factors and some of them have been listed above. To know about the exact amount of premium, the calculator allows us to add every information that we want. It helps in comparing various plans and carries out the plan that suits our needs.
  • The tool allows you to know about the premium of any medical policy in advance. It helps us to save a lot on time and cost. Just at a few clicks, the person can know about the amount to be paid.
  • Once you have known about the estimated cost of your premium, all the discounts will be linked with the same will be notified to you.

Care Health Insurance ensures that no family has to come across the burden of financial expenses while dealing with such mishaps. The plans available can be customised in any way depending upon the requirements of the person to be insured. The health services that it provides are rated 5 on 5 by its consumers. Time is very uncertain. So this is your time to think and decide about your insurance plan with Care Health insurance.

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