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5 Factors that Affect the Cost of Your Health Insurance

22 Oct , 2014  

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If you thought the price of health cover is more than you initially thought it would be, here is a breakdown of how the cost of premiums are determined.

Health care law states that health insurance vendors can bring into play 5 factors when establishing the cost of premiums. The combination of factors is used to determine how much you pay for health insurance. The type of plan you choose, your family size, age, your location and whether you use tobacco are all considered when pricing health insurance premiums. What does not seem to bear relation to price is your gender and health condition.

The 5 factors which set the price of your premiums

Age
Does age really matter? Yes, simply because older customers can expect to pay as much as 3 times more than younger customers.

Location
Why would where I live impact the price I pay for health insurance? Health insurance providers take into account any local laws in place, the existence of competitors, as well as the difference in cost of living that depending on where you live. All of these contribute to the price of your plan.

Size of family
This one stands to reason. It is generally expected that premium costs depend on the number of individuals covered. A single person will pay a lesser fee as compared to a married couple with dependents.

Do you use tobacco?
The health dangers attributed to tobacco use makes this factor a significant one. Health insurance vendors can implement an increase up to twice as much on premiums for users of tobacco as compared to those who don’t use the substance.

Choice in health insurance cover
The range in health insurance cover options influences the cost you will pay. Entry level plans with fewer benefits can be purchased at a lower price as compared to the more comprehensive cover offered in higher priced cover option.

The extent to which these factors can impact on the price you pay for health cover can be set by the State in which you reside. Another determinant that may have an impact on pricing is the additional benefits included in the cover by health insurance vendors.

It is recommended that when opting for health cover that you arm yourself with as much information to make the best decision possible without being overwhelmed by too much irrelevant information. Referring to a professional and experienced adviser can eliminate what can be considered a daunting prospect.

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