Health insurance plans in India are annual products offered by general and health insurance companies. The premium payable on health insurance was accepted by insurers only on an annual basis until recent times. In the wake of the pandemic, when many people were facing job loss, reduction in income and financial strain, the regulator allowed insurance companies to offer monthly, quarterly and half-yearly premium payment modes to customers in addition to annual mode. This was done to help customers by easing the load of paying the premium amount for the year at-a-go into small time periods of each month, quarter or six-months, as is convenient for them.
Some insurance companies have this facility up and running currently, while a few others have yet to do so. In due course of time, though, all insurance companies are likely to have this premium payment flexibility as soon as their systems are built to support it.
By opting to pay health insurance premium in installments customers can enjoy the following benefits:
- Less financial strain: Naturally, when you divide the annual premium amount over a period of 12/4/6 months, the financial strain on your cash flow is eased to a great extent. This is particularly applicable to policies of higher sum assured, where the premium is higher, or in the case of senior citizen plans, where the age of the primary insured (since it is on the higher side) can mean higher premium payable. In such cases, the facility of being able to pay over a period of a few months instead of all-at-once, will greatly help policyholders retain liquidity,
- Convenient: Customers can choose the time period most convenient to them for premium payment i.e. either every month, quarter, every six months or once a year.
- Affordability of higher coverage: Customers can avail a higher coverage amount offered by the health insurance plan while paying the premium in installments. The health insurance policy will continue to protect you from unexpected financial woes, while you continue to pay the premium over the time frame chosen by you.
However, customers should also be aware of some important points prior to opting for premium payment in installments, which are:
- Nominally higher total premium: Most insurance companies will charge a small percentage extra for availing the option of paying the health insurance premium over a span of months instead of a one-time payment in a year. While the percentage might be small, customers must be aware of this fact and be prepared financially for the slightly higher premium amount payable as a total for the year.
- Keeping track of payment due dates: Customers need to keep track of the payment frequency and ensure that the premium is paid on time (whether every month, quarter or bi-annually). If, for any reason, you forget to make the payment or the payment doesn’t go through due to any transaction error, or for lack of funds, your policy will enter into grace period, which is typically 15days. If you forget to pay even during the grace period, the policy lapses.
- Claims settlement: If there is an unfortunate situation of a claim, then the insurance company will deduct the balance of the premiums to be paid from the payable claim amount.
SANA Insure is a licensed general direct broking firm that specializes in advice and distribution of health insurance plans. With over a hundred options to choose from, ranging across categories such as individual, family floater, senior citizen, critical illness and maternity-benefit plans, SANA Insure can help you select, compare and choose the right health insurance policy that covers all the health requirements of your family members and yourself.
We invite you to visit our health insurance portal, sana.insure for quick, impartial, simple and easy access to comparative information across various health policies available in India, best suited to your needs. Our Health Insurance Advisor can help guide you along the way in choosing the right plan.
Wish you a healthy and happy life! Sana = Happiness!!