Brace Yourself For Higher Health Insurance Premiums

  Author: Jai Prakash

Securing your family’s finances with health insurance just got more expensive. From April 1, 2017, thanks to new regulations by insurance regulator Insurance Regulatory and Development Authority of India (IRDA), companies will be allowed to revise their premiums to provide better commission or remuneration to insurance agents besides introducing a reward system.

Magnitude of health insurance premium hike For individual health insurance products, the commission for agents has been set at 15 per cent of premiums. This may lead to insurers revising insurance premiums after they rework costs related to commissions and rewards. Needless to say, such a cost will be to be borne by the consumer.

Thankfully, IRDA has tried to ensure that there is no runaway rise in health insurance premiums. Insurance premiums can be increased or decreased by 5%. Health insurance premiums are likely to go up to a maximum of Rs 50 for every Rs 1,000 of sum insured. This may not be such a huge hike compared to the hikes insurers have affected for health insurance plans in the past.. However, the bad news is that once the GST comes into effect from July 1, premiums may go up even further.