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New York
May 12, 2021
Finance

Factors to Consider While Renewing Health Insurance Plan

Even the ones that buy health insurance often end up having wrong notion about it. For example, many people believe that health insurance is simply like a subscription where you keep paying the same fee for the same service. However, that is not the case. Even if the amount of coverage remains the same, medical expenses keep rising and your coverage may not be enough. Knowing this your quickest notion would be to buy an entirely new policy.

However, buying a new policy would mean going through the complete process of buying health insurance. This might include medical checks, verifications, waiting periods, etc. Instead you could use the opportunity of policy renewal to your advantage. For that you need to know what factors contribute to changes in policy during renewal. Here are a few factors that you should pay attention to while renewing your health insurance policy:

  1. Sum insured

Medical expenses grow by huge margins each year and are projected to follow the same trend for the foreseeable future. Hence, the coverage that may have bought previous year may not be enough to cover next year’s medical requirements. Sum insured being the maximum amount that an insurance provider will cover you for deserves special consideration during renewal. You should know that higher coverage would charge higher premium. Hence, you need to find the right balance between getting the right amount of coverage and paying an affordable premium.

  1. Family

You may be buying the policy but you are not the only one with medical needs in your house. Your family members are bound to have at some illness at some point of time. Your policy should include them into the coverage. Moreover, your coverage should also cater to their specific medical needs.   For example, if you and your wife are planning to have a baby, you should buy the maternity cover at the time of renewal. While it is true that you cannot predict when a medical condition occurs, it is better to be prepared.

  1. Claims service

In the instance of having to admit yourself or your family member into a hospital, the last problem you want to deal with is poor claims service from your insurance provider. Delays or issues with claims processing can put you into a poor situation. While your medical needs require immediate attention, your insurance provider’s poor service would have you wait or pay medical bills out of your own pocket. Hence, you should look into information claim settlement ratio and read reviews online before renewing your policy.

  1. Add-ons

The biggest concern during health insurance renewal is coverage. As medical needs increase, your coverage should increase as well. However, going for a higher sum insured means you have to pay more premium as well. To avoid such a situation, you can go for add-ons. At a minimal hike of premium, you could have additional coverage for specific situations.

However, buying add-ons is complicated. Buying too many unnecessary ones means that you end up paying for more coverage than you need. On the other hand, not having the right add-on with you means you are not covered for a specific situation that has a high chance of occurring. Hence, you need to pick the right add-ons.

Moreover, before renewing your policy you should consider looking into the range of add-ons that your insurance provider offers. It may happen that the add-ons that you wish to have with your policy may not be offered by your insurer. In such a case, you may also want to consider switching providers.

  1. Deductions

A compulsory deduction is mandatory as per the terms of the policy. However, a voluntary deduction can be chosen by you to include or omit. A voluntary deduction is a great tool for if you want to have higher medical coverage for a lower premium. While your coverage remains the same, by opting for a voluntary deductible you have to pay a lower premium. However, a deductible is essentially the amount you pay at the time of a claim. Hence, you have to consider how much deductible you opt for.

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