Expensive Health Insurance Ways To Cut The Cost.
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Expensive Health Insurance? Here's How to Cut Costs
Summary:
Health insurance premiums have been on the rise, and you may have noticed an increase recently. Let’s explore the reasons behind this trend and discover strategies to help reduce these costs.---
Understanding the Rise in Health Insurance Costs
According to Datamonitor, a market research group, health insurance premiums have been climbing by 8% annually due to medical inflation. Advances in new drugs, therapies, and diagnostic equipment contribute significantly to these increases. As technology improves, so do costs, often making newer and improved options more expensive.
The Impact of Age on Premiums
As you age, insurance risks?"and therefore costs?"can rise. Many insurers still use age bands, meaning premiums jump at the start of each new decade of life. For example, moving from the 40-49 age group to the 50-59 group can lead to substantial increases, sometimes as much as 50% for those between 60 and 69.
However, some companies like BUPA, Pruhealth, and Axa PPP are mitigating these jumps by implementing gradual yearly increases. Axa PPP, for instance, adjusts premiums annually by about 2% based on age.
Concerns About Rising Costs
The steady increase in premiums is causing concern among consumers, with many choosing to cancel their policies as they approach their 60s?"a time when they might need coverage the most. Data from Datamonitor showed a 15.2% drop in private medical insurance holders over seven years leading up to 2004.
Strategies to Reduce Costs
To better manage health insurance expenses, consider these options:
- Policy Excess: Opt for a higher excess on your policy to lower premiums. For example, BUPA reports that a £2,000 excess could halve your premium, while a £100 excess might reduce it by 10%.
- No-Claims Discounts: Many insurers offer discounts for not claiming. Some provide up to 50% savings, which can often be transferred if you switch providers. Axa PPP offers an immediate 27.5% no-claims discount at the start, but it’s lost with a claim. Meanwhile, some BUPA policies guarantee claim-related increases will not exceed 10%.
- Healthy Lifestyle Incentives: Pruhealth encourages maintaining a healthy lifestyle. By earning points for participating in various activities, you could receive between 25% and 100% off next year’s premium.
Explore Your Options
With a variety of solutions available, now is a great time to explore your options. Don’t simply keep paying higher premiums or, worse, lose valuable coverage by canceling your health insurance. Search online for an insurance broker who can tailor coverage to fit your budget. Plus, you might benefit from an online discount.
By understanding the factors that drive premium increases and taking proactive steps to mitigate them, you can ensure continued coverage without breaking the bank.
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