When trying to find affordable health insurance, we might compare what we get with what we pay. Insurers work out your premiums depending on a few factors.
These could be related to who you are, your lifestyle, and additional external factors. Every insurer uses a slightly different formula to come up with the premium you need to pay. Even when you have shopped for the best health insurance policy that gives you everything you need at an affordable price, you will notice your premiums going up over time. Why does it happen, and what factors are at play here?
Inflation
In economics and finance, inflation is the rate at which the cost of different products and services increases over a given period. A high level of inflation means you can no longer buy as much for the same amount as you would have a few months before.
Inflation is a blanket phenomenon that affects everything around us, including the cost of health insurance. As the cost of other products and services increases over a given period, usually a year, you will also notice your premiums creeping up, and this is something you can expect due to forces beyond your control.
Age
The likelihood of getting injured or ill increases as our bodies change as we age. Insurers take age very seriously because they know an increased likelihood of getting sick means additional claims. Some might also use age bands for different ages so when you move to a higher band, your health insurance premiums increase.
Some may also increase the premiums gradually as you age, so you do not notice a big jump when you move from one band to the next. In some cases, you may find that the increase is large enough that it is no longer justifiable to renew your insurance with your provider.
In that case, you should start shopping for health insurance NI to find better quotes. Comparison platforms like Compare NI let you compare insurance cover from different insurance providers to get the best quotes. You can compare health cover here; on the website, you can also compare other types of insurance including home and auto insurance.
Claims
Even though that is their business, and many will not admit it, insurance companies do not like paying claims. Many insurers will pay genuine claims, but that does not mean they like it, and they will encourage people to make as few claims as possible.
When you go for a long time without making a claim, you might get a discount when you renew your health insurance policy. However, if you have made several claims, usually more than two or three depending on the insurance provider, you might notice your insurance premiums go up.
Insurance companies deem those who make numerous claims to be a risk to their business and thus increase the cost of their premiums to cover themselves.
Both situations do not always happen because each insurance company handles discounts and claims and how they affect your premiums differently.
Conclusion
There you have it, three of the most common reasons your insurance premiums will keep increasing. They may be out of your control, but you can always switch to a cheaper health insurance provider to keep costs manageable.
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