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How Multi-Year Health Insurance Can Lower Your Premium Costs

How Multi-Year Health Insurance Can Lower Your Premium Costs

With the rise in lifestyle-related illnesses, unexpected health risks, rising healthcare costs, and financial insecurity, Generations Y and Z are becoming more health insurance conscious.

Many professionals from these two segments have constituted their group health insurance. However, these policies only protect policyholders during their active employment and offer an average insured sum of Rs 2-5 lakh, which is relatively low given rising medical inflation.

Therefore, taking out separate health insurance, whether on your own or with your family, has become a legitimate need to ensure maximum health protection. It ensures that you are always and adequately protected.
Generally, people opt for an annual policy that is renewed annually.

However, multi-year health insurance, the option of paying premiums for two or three years at a time, has a number of advantages.

On the one hand, it allows policyholders to pay the premium for the next two or three years all at once or in installments, which makes the annual renewal of the contract easier, more convenient, and cheaper.

Here are some of the benefits of a multi-year plan that customers should be aware of:

Reduced Premiums – Multi-year health insurance offers an additional discount on premium rates. The discount usually varies between 5% and 10%, which means additional savings for customers.

Lock-in benefit: Multi-year health insurance includes a fixed premium for the term. This ensures that the agreed premium level remains the same for the duration of the multi-year policy and that the policyholder is protected from periodic premium increases by the insurer during this period.

Tax Benefits: Under Section 80D of the Income Tax Act, a policyholder can enjoy tax benefits on the premiums paid by him, his spouse, and his children up to Rs 25,000. A multi-year policy ensures tax benefits year after year.

Younger clients can benefit from tax benefits and opt for comprehensive insurance with sufficient insured capital and maximum coverage instead of basic insurance.

Don’t stress over annual policy renewals – With digital sources and apps, policy renewals have become a breeze these days. However, the number of those who do not renew their contract on time each year is surprisingly high. The multi-year policy works as a single permanent solution, eliminating periodic renewal requirements during the term of the policy.

Continuous Protection – Timely renewal is required for all policies to ensure continuous coverage. Failing to do this can be detrimental as it leaves customers vulnerable. With multi-year health insurance, young policyholders receive uninterrupted insurance benefits longer.

EMI Advantage: Policyholders can pay premiums at their convenience and on the spot, making it more affordable for the younger generation.

Multi-year policies help save and strengthen your financial safety net from the start. It is always advisable to choose an all-risk plan with a higher sum insured for better protection. In addition, you should also compare various health insurance plans and be aware of all the terms and conditions, including exclusions, before purchasing one. This saves policyholders from last-minute surprises during a medical emergency.


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