As senior citizens, obtaining health insurance is crucial for financial security during medical emergencies. Insurance providers often offer specialized policies tailored to seniors aged 60 and above, providing extensive coverage for hospitalization, pre-existing conditions, and critical illnesses. However, premiums for these policies can be relatively high due to the increased likelihood of chronic diseases and ailments.
Strategies to Reduce Health Insurance Premiums
Co-payment
Co-payment involves the insured paying a percentage of the claim from their own pocket. Plans with higher co-pays typically have lower premiums since the insurer’s liability is reduced. For example, if an individual has a policy with a 20% co-payment and makes a claim for ₹2 lakh, the insurer pays ₹1,60,000, and the insured pays ₹40,000, resulting in a reduced premium by 20-25%.
Deductibles
Deductibles, also known as self-insurance, require the insured to pay a specific amount of medical expenses before coverage begins. Plans with deductibles generally have lower premiums compared to those without. For instance, with a ₹5 lakh sum assured plan and a ₹1 lakh deductible, if the claim is ₹3 lakh, the insured pays ₹1 lakh, and the insurer covers the rest. Deductibles can significantly impact premiums, reducing them by 40-50% depending on the deductible amount.
Super Top-up Plans
Super top-up plans, combined with base policies, offer additional coverage without the need to pay the deductible amount. These plans can be a smart way to reduce premiums while increasing coverage. For example, if someone has a base plan covering ₹5 lakhs and a super top-up plan covering ₹10 lakhs with a ₹5 lakh deductible, claims exceeding the base plan coverage are covered by the super top-up plan.
Considerations
While co-payment and deductibles can lower premiums, they come with out-of-pocket expenses. Opting for comprehensive coverage without co-pay and deductibles is recommended if affordable. However, if reducing premiums is a priority, exploring various options is advisable.
“In case you can afford the premiums, it is always recommended to go for a comprehensive cover without copay and deductibles,” says Nerukar. But for those seeking reduced premiums, considering available options is essential.
