Does Health Insurance Premium Increase With Age?

We often don’t think about health insurance coverage until we really need it. Take the story of Mr. Sharma, for instance. Back in his 40s, he felt like he could take on the world without medical coverage. Quick forward to his 50s, and out of nowhere, health issues started crawling up. When he finally decided to get insurance, bam! His premiums shot up like fireworks. Plus, he had to jump through hoops with medical check-ups and waiting periods that left him shelling out cash for treatments until he was covered.

The reason behind Mr Sharma’s high premiums is simple: age. But how does age influence the rate of premiums in health insurance?

In this article, we’ll find the answer to this question, break down how premiums tick, unravel the perks of No Claim Bonuses, tax breaks under Section 80D and much more!

So, let’s begin!
 

What Is Health Insurance?

A health insurance plan has your back when life throws a curveball like hospital bills. It provides comprehensive coverage in the realm of huge medical expenses. From emergency hospital visits to medications and even doctor visits, it's undeniably covered under this shield. By paying a premium, you're not just paying for peace of mind—you're shielding yourself and your loved ones from the hefty costs that can sneak up on you in times of need. As a superhero cape for your savings and well-being, health insurance ensures that you and your family can appreciate inner harmony and monetary security over the course of life.

Now, let’s get to understand how premiums work in health insurance!
 

What Is Health Insurance Premium?

Health insurance premium is the money you pay to make sure you're covered against medical expenses. The insurance company takes on the risk, so you pay them to handle it. And there are these extra fees sometimes, like stamps or taxes, that you need to tack along with the gross premium. It's like paying to keep your health covered without worrying about big bills later on.

Curious how health insurance premiums evolve with age? Here’s the lowdown on why insurers adjust costs as we grow older!
 

Does Health Insurance Premium Increase With Age?

Yes, one big thing that bumps up health insurance costs is age. As we get older, our bodies tend to need more care, right? Insurers see that as more risk when they're figuring out how much to charge us for coverage.

You know, as individuals age, they frequently need more clinical attention, like doctor visits, tests, and treatments. All those extra healthcare services add up, and that is the reason insurance expenses can be higher for the older populace.

The healthcare costs keep going up over time. With commendable medical advancements, more people needing care, and prices going up in general due to inflation, insurers end up charging more for premiums. Insurers transfer these increasing costs to policyholders, resulting in higher premiums for older individuals.

Moreover, when you get older, sometimes you might already have pre-existing medical conditions. Insurance companies notice that, so they might increase your premiums because they think you might need more help as you get older.

Now, with increasing age, your chances of ending up in a hospital are higher than when you're younger. It's just how life goes—people start suffering more from failing health issues, reduced stamina, and low strength, making them more ill. So, you end up needing more robust health insurance coverage, which, let's face it, costs more, too. Plus, there's the possibility of needing daycare hospitalisation, which, thankfully, some plans cover. So, insurance companies adjust premiums to account for the increased risks and costs that come with ageing.

Wondering why to buy health insurance early? Here’s why grabbing a policy early could save you headaches (and bills) down the road!
 

Why Buy Insurance At A Young Age?

Here are the pivotal reasons why you must buy insurance at an earlier age-

1. The Same Premiums Won't Apply If There Is A Health Issue
   As a young adult, you might question why you should pay for health insurance premiums if you're healthy. It's a fair point! However, remember that health insurance premiums can change every year, and medical care costs are continuously rising due to inflation. In this way, regardless of whether you're totally sound currently, having protection guarantees you're ready for unforeseen health challenges in the future. And to keep this coverage intact,  you need to pay timely premiums. Using a health insurance premium calculator can assist you with estimating the costs in light of your ongoing well-being and age. The premium you’ll pay tomorrow might just not be what you're paying in a few years down the line. And if you happen to catch an illness or disease, those costs could shoot up even more. A health insurance policy that might feel like a luxury now could be your lifeline later on. Getting it while you're young can be a smart move to cut down on costs today and down the road.
    
2. Ideal For Getting Comprehensive Coverage
   Insurers assess your health risk when you buy the policy. Once your health evaluation is performed, the policy terms stay steady throughout. The plan remains unchanged regardless of any claims made or medical conditions diagnosed after purchase. When you're young and fit as a fiddle, illnesses and diseases tend to steer clear of you, meaning fewer claims to insurance companies. Insurance companies are eager to cover such customers, allowing you to access the best and most comprehensive insurance plans. A health condition or disease can seriously reduce your chances of getting a top-notch comprehensive insurance policy.
    
3. Prior To Growing Old, Complete All Required Waiting Periods
   When you buy a policy, there's this time frame where, if you get hospitalised for certain things, the insurance won't cover the expenses. This is known as the waiting period. This applies to specific diseases, medical procedures, any pre-existing conditions you had prior to purchasing the policy, and some special treatments. The exact details are all spelt out in the policy wording, but essentially, it's a way for insurers to protect themselves from people getting a policy just to cover an imminent expense they definitely know about. Thus, during this time, you cannot claim any hospitalisation expenses, and you need to pay for them at your personal expense.
   Now, think about this: if you buy a health insurance policy when you’re young and in good shape, like at 20 or 25, you’re basically serving that waiting period while you’re not even likely to need the insurance. By the time you might actually need to make a claim, the waiting period will probably be long gone.
    
4. No Medical Check-Ups
   So, consider this: in the event that you're 45 or older and hoping to get health insurance, most companies will ask you to do a health check-up. Why? Well, you're more likely to get sick and file a claim when you're that age. Before approving your policy, insurers need to ensure that you are not too risky to even consider covering. Consequently, when you get a health insurance policy while you’re young, they generally won't demand a clinical examination. The only exception is if you mention some existing illness or lifestyle condition on your application.
    
5. Tax Benefits Under 80D
   Under Section 80D of the Income Tax Act, you can get some fine tax exemptions just by having a health insurance policy. So, if you buy one when you’re young, you can start reaping those benefits sooner.
    
6. No Claim Bonus
   If you don’t make any claims during the year, the insurance company actually gives you a reward called a No Claim Bonus. It’s like a little pat on the back for staying healthy!
   
   Here’s how it works: you can receive this bonus in two different ways— your sum insured can be increased for the same premium, or your premium can be reduced by a certain percentage.
   
   When you're young, you're less inclined to file any claims, right? So, every year you renew your policy without making a claim, you'll procure a No Claim Bonus. The bonus builds up, and you get an increased cover in the later years.
    

Here’s The Bottom Line, 

Getting health insurance when you’re young is like planting a money tree for your future. You get to enjoy lower premiums, dodge those annoying medical check-ups, and start building up the No Claim Bonuses right off the bat. Plus, you’re scoring tax benefits and the sweet relief of knowing you’re covered for any surprise medical bills. By the time you might need to use it, you'll have this solid coverage without breaking the bank. Seriously, why wait? Lock it in now, and in the future, you will thank yourself for making such a smart move. Cheers to living stress-free!