The cost of paying health insurance premiums must be viewed as a lifetime commitment because, unlike term insurance or endowment plans, they do not have a set payment period. So that you are not dependent on your spare money, consider your annual health insurance expense while creating your budget. Planning ahead will prevent the money you had set aside for a vacation or a wedding gift from being used instead for your health insurance.
The majority of wage earners already do this, but having an emergency fund is another smart move. Financial experts advise keeping up to one month’s worth of essential spending in a savings account for quick access. For bigger situations, three to six months’ worth of expenses can be held in a fixed-sum savings account. If you don’t have available money when your annual premium payment is due, take money out of this source and put it back in when you have enough money. If all else fails, think about paying your health insurance premium with a credit card.
Two essential considerations are:
- Purchase only the amount of insurance you can afford: In the long run, a premium of Rs. 20,000 will be too expensive for you if your yearly salary is Rs. 3.5 lakhs. You can calculate the cost of premiums using a health insurance premium calculator. *
- Pay Close Attention to the Premium Due Date: Assign a few alarms, ideally at least two: one month and the other one week prior to your due date. If you can’t obtain enough money, you still have a week to accumulate emergency funds. This will give you a month to do it.
There are several distinct and severe repercussions for not paying health insurance premiums on time:
If you fail to pay by the due date, your insurance will enter a grace period; if you pay during this time, the online health insurance policy will continue with all the benefits you’ve accumulated up to that point. You won’t have coverage during this 15/30 day period, though.
Your policy will expire if the premium payment is not made during the grace period. Your insurance company can request that you purchase a new policy, in which case all diagnoses made over the course of your coverage will be viewed as pre-existing conditions.
Both the lifelong renewability benefits provided by IRDAI regulations and the tax deduction benefits under Section 80D of the Income Tax Act will be lost to you.
For people who have trouble with long-term financial planning, EMI payment is a workable choice. The health insurance low premium is broken up into manageable monthly instalments, which is easier on your finances. **
Observations regarding EMI payments for health insurance
- Only plans with an excess over a specific amount are eligible for this method of payment.
- If you choose to pay in monthly instalments rather than annual payments, the rates will increase by up to 5%.
- The premium for the previous three months will be subtracted from your claim amount if you file a claim in September.
- Industry experts think that EMI gives insurance seekers more flexibility in terms of increased insurance coverage. People who are considering purchasing individual policies can often think about investing in a family floater policy instead because the cost may be easily spread out over a longer time frame.
Now that you know how to manage your health insurance low premium payments conveniently and ahead of time, you won’t need to work late into the night. It’s time to apply what you’ve learned now. Getting your health insurance payments back on track can be done anytime.
* Standard T&C Apply
** Currently, there are 2 tax regimes in India – new and old. To get the tax benefit you desire, choose the correct one after consulting an expert. You can opt for a regime change during the next financial year.
# Visit the official website of IRDAI for further details.
## All savings are provided by the insurer as per the IRDAI-approved insurance plan. Standard T&C apply
Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.
