scorecardresearchMulti-year health insurance plan: What's in it for you?

Multi-year health insurance plan: What's in it for you?

Updated: 28 Jul 2022, 07:40 AM IST

If you don't want to deal with the hassle of having to renew your coverage each year and you can afford the higher one-time premium cost, a multi-year health insurance plan can be useful for you. To learn more about its advantages, continue reading.

We discuss here the benefits of a multi- year health Insurance Plan

We discuss here the benefits of a multi- year health Insurance Plan

Given that medical crises can occur at any moment and that healthcare prices are rising, it is preferable to have insurance that covers all medical bills in full. Multi-year health insurance policies are the new frontier, and much like term and other insurance policies, you may now obtain a health insurance policy that lasts for several years.

The most affordable and practical option to be ready for any serious health circumstances that may develop in the future is a multi-year health insurance plan. As the name implies, a multi-year insurance will offer coverage for a period of two or more years. It enables policyholders to pay the premium for the following two or three years all at once when purchasing the policy, saving them the trouble of having to renew it each year.

Benefits of multi- year health Insurance

A multi-year health insurance plan may be advantageous for you if you don't want the inconvenience of renewing your policy every year and can afford the higher one-time premium expense. Here are some benefits of choosing a multi-year health insurance plan.

Reduced premiums

Customers receive concessions from insurers for paying multiple years' amount of premiums at once. The discounts, which might result in further savings for the clients, normally range from 7 to 15 percent. Customers purchasing a health plan for one year are often not eligible for these reduced premiums.

Lock-in benefit

As you become older, the premium you pay increases annually, as you may be aware. For instance, the premium for a 40-year-old can be 30–40% greater than for a 30-year-old. You can fix the premium amount for the upcoming two to three years by choosing to pay a multi-year premium beforehand. This, in turn, will assist you in avoiding the anticipated increase in premiums if the insurer revises them.

Hassle free procedure

Plans with a duration of two to three years have the benefit of not requiring a waiting time for each renewal. Furthermore, multi-year health plans dramatically minimize the quantity of documentation needed.

Tax benefits

One may receive tax advantages of up to 25,000 under Section 80D of the Income Tax Act on health insurance premiums paid for oneself, one's spouse, and one's children. However, if you purchase a multi-year health insurance plan, you can proportionally split your one-time premium payment over the course of the plan's duration to receive the tax advantage.

While the pandemic made many people more aware of how costly hospital stays can be and how they may negatively impact one's income in several ways, it also raised awareness of the value of health insurance.

Although there has been a noticeable increase in awareness over the past two years, health insurance acceptability in India still remains very low. Whatever stage of life you are in, having a sufficient health insurance plan is essential and with the introduction of multi- year insurance plan, this process might be a lot easier.

These are the benefits of health insurance 
First Published: 28 Jul 2022, 07:40 AM IST