8 Tips to reduce premium

1) Increase the annual deductible

If you are happy to pay for the occasional visits to your doctor or prescription, increasing your annual deductible can sometimes reduce your premium significantly. Sometimes by even 70%, it differs from product to product. Deductibles can be per policy or per medical claim. And it can range from US$50 to US$10,000. Table below shows an example of how premium changes with different levels of deductibles

Age Band Plan without deductible Plan with US$400 deductible Plan with US$1,600 deductible Plan with US$5,000 deductible Plan with US$10,000 deductible
10-25 $3,196 $2,192 $1,586 $1,255 $942
26-44 $5,011 $3,959 $2,874 $2,278 $1,707
45-59 $6,019 $4,928 $3,659 $2,909 $2,182
60+** $6,327 $5,321 $3,948 $3,019 $2,264

IHI BUPA 2010 rate (US$), Annual premium per person, Hospital Plan
** Applicable to renewals only

2) Pay for only what you need

Know what you need to be covered and pay only for that. Many companies lump extras that may seem as at no cost but in fact you are paying for it some way or another. One of these extras comes in the form of being covered for chronic conditions. You have to first decide if you are under high or low risk category. Are you obese? Do you smoke or drink heavily? Do you have a family history of any of the chronic diseases? If you determine that you are in the low risk category, you can use your own judgment to delete this cover. Having said that, there are also rare cases where a perfectly healthy young individual develops a chronic illness.

3) No Claims Discount

An international health and medical insurance is usually more expensive compared to a local plan. This is due to various reasons such as wider geographical area of coverage, higher level of coverage, etc. As the market develops, insurers often come out with more innovative products and competitive rates to fight for new businesses and keep their customers. Some insurers offer a No Claims Discount, sometimes up to 15%, upon renewal. Once a claim is made, a substantial increase in premium may result. If your policy offers No Claims Discount, it could be better to go for individual policy verses one policy for the entire family as one claim may affect the premium of the whole group. So it pays to have a long-term plan and do your due diligence to shop around for the best products and insurers.

4) Define your area of coverage

Most insurers have 2 categories: Worldwide and worldwide excluding USA. Some insurers have more specific geographical breakdown. Premium increases with wider area of coverage. With better definition, in some cases, it could reduce your premium by 60%.

5) Pay premium annually

Most insurers will give you the freedom to pay monthly, quarterly, half-yearly or annually. The rate decrease with the decrease in payment frequency. In some cases, paying your premium annually can save up to 7.5%.

6) Full declaration of medical history

With Full Medical Underwriting, sometimes premium can be reduced by 3%.

7) Tailor different levels of cover for different members of the family

Different persons require different levels of coverage. Generally, younger healthier individuals require lesser coverage with lower benefits compared to older individuals. Examine the different requirements and where you can save cost

8) Lower level of benefits

Understanding the kind of medical facility available in your country of residence, the standard and the cost of medical treatments are important. This will help you understand how much benefit you need and in which area. You can limit out-patient cover, state a specific category of room, or restrict your choice of hospital.

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How to choose