Should I pay Higher Premium on Health Insurance Renewal for Parents
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Should I pay Higher Premium on Health Insurance Renewal for Parents

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A reader messages finance clock team on whether he should pay higher premium on health insurance renewal for parents. Here is the solution.

Question: Need your opinion regarding Health Insurance Renewal for my Parents. I have enrolled my parents in CARE GROUP Health insurance in Year 2020 for the coverage of 5 lacs and annual premium of 28k. Premium was paid for 2 years combined. Now while renewing, CARE has increased the premium to whopping 45k (60% Increase).

Reason for increased premium given was Inflation and change in year slab. Year slab is invalid excuse as my parents were 61 then and 63 now. I have not made any claim in past 2 years and earned the NO CLAIM BONUS of 1 lack. I am getting option to port the POLICY to NIVA BUPA with similar or even better terms. Premium will be 34k per annum.

In this case, I will be loosing on NO CLAIM BONUS but Pre-existing disease waiting period will carry forward.

Pay Higher Premium on Health Insurance of Parents

a. Can I negotiate with CARE team to decrease the premium?

b. Will it be wise for me to change the Service provider to save money on premium? And most Important Question: NIVA BUPA is offering a discount of 2,500 or 5,000 If I pay premium for 2 or 3 years respectively. This will also shield me from no increase in Policy Premium for next 2 or 3 years.

c. Should I heed their advice and pay the premium for next 2 years/ 3 years now?

You

a. Can I negotiate with CARE team to decrease the premium ?

Unlikely, you may try. Premiums are usually standardized

b. Will it be wise for me to change the Service provider to save money on premium?

No one can answer this objectively. You will save 11k pa, may be worth it but think what happens if Bupa raises premiums? But if you want to go ahead, see what Bupa is charging for ages 64/65/66 just to get sense of premiums on offer at the moment. (These can change depending on claims experience) and most Important Question: NIVA BUPA is offering a discount of 2,500 or 5,000 If I pay premium for 2 or 3 years respectively. This will also shield me from no increase in Policy Premium for next 2 or 3 years.

c. Should I heed their advice and pay the premium for next 2 years/ 3 years now ?

This 2 year or 3 year premium paid in one go already accounts for age increases per slab. So its not that the age slab increases are ignored. All what they do is offer a discount as you are paying for 2-3 years so they have future premiums right now. More a marketing gimmick.

About Post Author

Robert

He is a prolific writer and finance enthusiast. He likes to read more about the latest updates in finance sector and share tips and tricks to improve personal finance security.
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