People from all over the world make decisions about their health every day. They decide when and how to schedule medical tests and procedures, what types of exercises to pursue to manage their medical conditions, and even where to purchase health insurance. When it comes time for a person to buy health insurance, the individual who is doing so has the choice between enrolling in a single-year plan or purchasing a multi-year plan. Here are a few reasons to consider multi-year health insurance:
Save money on premiums
When it comes to health insurance, there are a lot of different factors to consider. One crucial factor is how often you pay for your premiums. Many people pay their premiums yearly, but did you know that you can often save money by opting for multi-year health insurance? This is because insurers typically offer discounts for customers who commit to longer policy terms. You can save up to 10% on our annual premium if you choose a two-year health insurance policy, and if you choose a three-year policy, you can save up to 15%. This will save you a lot of money on your health insurance premium in the long run.
Lock in rates
Another advantage of multi-year health insurance is that it allows you to lock in current premium rates. With rising inflation, medical costs rise year after year, and your policy premium may change. Not only that, but your age plays a significant role in determining the cost of your premium. The higher the age, the higher the premium. You pay for your coverage upfront when you purchase a multi-year health insurance policy. As with a traditional health insurance policy, you will not have to worry about your premiums increasing each year.
Multi-year health insurance tax benefits
As per Section 80D of the Income Tax Act, 1961, you can avail of deductions on the amount of money you pay each year for your health insurance premium. This deduction is available for both individuals and Hindu Undivided Families (HUFs). The Finance Act 2018 has provided an additional benefit by allowing taxpayers to avail of the deduction for multi-year health insurance policies on a pro-rata basis over the policy term. This means that in a case where a lump sum premium is paid for a policy with a multi-year tenure, the deduction can be claimed proportionately over the years for which the policy remains in force.
Avoid the hassle of annual renewals with multi-year health insurance
One of the biggest benefits of multi-year health insurance is that it eliminates the need for annual renewals. This means you won’t have to go through the hassle and paperwork every year to keep your coverage in place. The assurance that comes from knowing you are covered for the long term is probably the biggest benefit. You don’t have to be concerned about a lapse in coverage if you experience a job loss or other life event which might prevent you from paying your yearly premium.
As you can see, there are several advantages to choosing a multi-year health insurance plan over a yearly one. So, if you’re looking to save money on your health insurance, paying for your premiums in advance is one option to consider. Of course, there’s no right or wrong answer when it comes to how you pay for your health insurance. Ultimately, the best option is the one that works best for you and your budget.
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