 "Want to pay health insurance premiums on monthly basis? Know these things before opting for plan")
Currently, there are four ways to pay for health insurance - monthly, quarterly, every half-year, and annually. When paying for health insurance in installments, particularly in the monthly and quarterly modes, policyholders must carefully read the fine print. Many customers, especially those who are salaried, like to pay their health insurance premiums monthly to make it cheaper and cover a larger amount of risk. Senior citizens who must pay a high premium can also benefit from the monthly premium payment option. This enables policyholders to both protect their own and their family’s health while maintaining enough cash on hand to cover other costs.
However, there are some factors that an individual should look at before opting for monthly health insurance installments.
Monthly installments can be costly:
A health insurance plan with a monthly payment will cost more than one with an annual one. The policyholder has to get insurance coverage with a minimum two-year policy term and pay a premium that is 5–10 percent higher when paid monthly as compared to the annual payment model. Certain discounts available with yearly payments will not be available to the policyholder.
Strict deadline:
Additionally, if the policyholder chooses the monthly premium payment option and is unable to pay the premium on time, he/she will receive a grace period of 10 days. Policyholders will receive the cumulative bonus if they pay during the grace period. The insured should ideally set up an auto debit request in his/her bank account so that the premium can be paid on time each month.
The claim process won’t be impacted:
The claim process will not be impacted by the premium paid on a monthly or quarterly basis. The policyholder should pay the entire balance premium upfront in order to settle the claim. Otherwise, the insurance company will deduct the balance premium for the year from the total claim amount. The insurer has to process the claim even if the policyholder has only given the premium for one month.
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View AllTax benefits can be claimed:
On the entire amount paid as a premium under any payment mode, the policyholders are entitled to receive tax benefits under Section 80D. To keep track of the total amount spent, they must retain the receipt for the down payment made when acquiring the policy, as well as any subsequent receipts.
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