Depending on where you live in the world, you may or may not have a need for a health insurance plan. If you live in a country that is lucky enough to have a state run health system then the idea of paying for the basic need of health care might sound crazy to you. This article is here to break down just how much having health insurance costs.
What is health insurance?
Health insurance is just what it says on the tin. It is a type of insurance that covers the whole or just a part of the possibility of a person incurring medical expenses. It can be bought for just an individual or for a family, a person can also buy it themselves but some companies do also offer a company health insurance plan.
How does health insurance work?
Health insurance works by assessing the risk of people signing up to the health plan. People tend to pay a small amount per month, around 3-5% of the risk factor, and the health insurer collects this money, using it to cover the costs of the users who fall sick. It is very typical that younger people pay less as they have lower risk factors than older people, this way they pay lower amounts when they are younger and use them as they age. It is for this very same reason that it may be slightly harder for elderly people to be able to find health plans for a reasonable price, as they have a higher risk of claiming back on the insurance. Before buying health insurance a person will be screened first, this is in order to see their medical history in order to measure their risk factors, and thus calculate how much they would have to pay monthly for their health plan. Also, health plans work on deductibles. What a deductible is, is that it is the amount that you have to pay for the health care before your health insurance will kick in and pay for the rest of the costs. Read more!
Factors that affect the cost of health insurance
As mentioned before, how much you pay monthly for your health insurance plan is calculated on how much of a risk you are to claiming on your health plan. One of the main things that can affect the cost of your health plan is your age. From an economical and logical standpoint this makes sense as older people tend to visit the doctor more and more medical problems are likely to develop as we age, thus increasing the risk factor and elevating the cost of the health plan. Another thing that can increase the price of health insurance for you is where you live. This might seem like a less obvious one but it is true. If you live in an area where there is a lot of health plan competition then you might find some great rates. However, if you live in a place where there is only one or two options then be ready to pay more. Another factor that could affect how much you pay for your health plan is if you smoke or not. By smoking you are voluntarily increasing your chances of getting ill and so you are increasing your risk factor which has a domino effect on the price of your health insurance.
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To round things up, a health insurance plan can be a costly thing based on how many of the risk factors that you meet. However, you must choose a health insurance plan that works for you, weather it be one with higher premiums but lower deductibles or higher deductibles and lower premiums. All of this depends on your current health and what your needs are. For more details, visit: https://www.investopedia.com/how-much-does-health-insurance-cost-4774184