What is Loading in Health Insurance?
Published On 15 Apr 2019 By Sakshi Aggarwal
Understand better here the concept of loading in health insurance plans
A few years ago, Mr. Raghav bought a health insurance policy from a reputed health insurance provider. He was very much satisfied with its services until recently as the company had
However, at the time of health insurance renewal in July this year, he got stressed. Because of his surprise, his premium shoots up high. When he tried to know more about it, he found out that it is because of something called ‘loading’. Just like many of us, Mr. Amit was also not aware of the concept of loading in health insurance. Lets us find out what it is!
Loading in Health Insurance-What Does It Mean?
The concept of loading comes into play only when an insurance company has to deal with such a candidate.
When Mr. Amit got his health insured along with his father, he was puzzled as the policies were exactly the same but the premium amounts were different. The premium amount of his father’s insurance was substantially higher than his. When inquired, he found out that the difference was due to the difference in their ages.
As age g
Factors Affecting Loading in Health Insurance
Certainly, the factors that affect the amount of loading
The premium on insurance depends on the amount and
Tobacco or nicotine intake is a factor that majorly impacts your premium amount. In health insurance, the premium amount
3. Medical state
Another factor that has an impact on loading applicable to premiums is medical conditions of an individual. For instance, a group of applicants aged 40 years will have an equal amount of premium because the probability of mortality will be the same. Whereas, if an applicant from the same group is obese, then he has to pay a higher premium than the rest of them. This is because obese people have a higher risk of organs like the brain, heart, and kidney getting damaged. This is what is called loading.
Some other factors that may affect mortality and eventually loading
- Place of residence
- Several medical conditions in the proposed insured and in the family
Is Loading Justified?
In some cases, yes, loading is justified. But not in all. A majority of insurance companies have a set age limit before and after which an individual cannot buy a health insurance policy. Maximum age generally varies from 65-80 years. This is because is difficult to get an estimate of expenses related to health in the higher age and most companies fail to do so.
So, if the applicant is suffering from a major ailment like diabetes, hypertension or asthma, or has bad habits like chewing tobacco or smoking, he/she will be offered health insurance plans on special terms with significant loading. This also prevents injustice to the client who is less prone to risk.
This is helpful for the insurer as it covers
Whereas loading is unjustified is when it is applied to an individual with a history of surgeries like cataract or a hernia. As these have easy treatments and have a negligible risk
In case you still have some thoughts running in head regarding health insurance, we are here to solve them. Leave us a message on email@example.com or call on 1800 1205 698. The experts at Insurancedekho.com will get back to you in no time with the best deals according to your requirements.