June 13, 2024


Marketing Needs Experts

5 Variables That Impact Your Health Insurance Quote

5 Factors That Affect Your Health Insurance Premium Costs - Experian

Because of the rising cost of medical treatment, the number of people purchasing a health insurance policy has increased significantly in recent years. People are buying policies for their families to ensure they have a financial cushion in any emergency. Health insurance not only protects you during difficult times, but it also provides tax benefits.


Insurance companies generally thoroughly assess your health profile when approving your insurance application. They fix the premium charges based on their review.

Factors that influence health insurance premiums –

Every insurance company has its own set of rules for determining premium costs. It is wise to compare health insurance plans and choose the one closest to your needs. 

Here is a list of factors that the companies consider when calculating medical insurance premiums:

  1. Age:

Age is a critical factor that influences the premium amount. Insurance companies generally follow the rule that the older you are, the higher your premium. So, if you buy a health insurance premium when you are young, you will get comprehensive coverage and wiser benefits at a lower cost.

  • Past medical history:  

Your medical history is critical in determining the premium amount. Your premium will be higher if you have a history of illness or a pre-existing disease. However, your premium will be lower if you have never been sick and have lived a relatively healthy life.

  • Occupation:  

The nature of your work and the risk you face influence your premium charges. If you work in a school, your premium will be lower; however, if you work in an environment with a high risk of injury, such as a construction site or a factory, your premium will be higher.

  • Policy duration:  

The duration of your policy is also essential. The premium will be lower if you choose a policy with a longer term. This may be different for a shorter-term policy.

  • Body mass index (BMI):  

Your premiums will be raised if you have a high BMI. People with a high BMI are more likely to develop serious illnesses such as heart disease, type 2 diabetes, high BP, breathing problems, etc.

  • Smoking habits:  

According to a report published in the medical journal Lancet, India has approximately 11.2% of the world’s smokers. Smoking raises health risks, and health insurance companies view smokers as high-risk insurance buyers, charging high premiums. When compared to non-smokers, smokers pay higher premiums.

  • Geographical location:  

The cost of your policy premium is determined by where you live. Premium rates are high in some geographic regions due to a lack of healthy food options, climate, and health issues.

The plan you choose:  

Premium payments vary depending on the type of health insurance coverage you select. Group health insurance offers a lower premium than an individual policy. Additionally, if you have purchased add-on covers, your premium will rise. 

  1. BMI – body mass index –  

People with a higher BMI are generally charged a higher premium than those with a normal BMI. This is because people with a high BMI are at a higher risk of developing diseases such as diabetes and heart problems and thus require regular medical care.

  • Co-insurance feature:  

If you choose co-insurance when purchasing a health insurance policy, your premium will be lower. In co-insurance, you pay a portion of the claim, and the insurance company pays the remainder. This step significantly reduces the premium amount.

The insurance company calculates the health insurance premiums using the health insurance premium calculator to determine the final amount after considering all these factors. You can use the same online to ensure you’ve added all the necessary add-ons.

** Currently, there are 2 tax regimes in India – new and old. To get the tax benefit you desire, choose the correct one after consulting an expert. You can opt for a regime change during the next financial year.

Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.