What is a Premium?

Are you shopping for individual health insurance? You may notice a number of new or unfamiliar terms, such as copayments, co-insurance, and premiums. Understanding each of these terms can ensure you get the policy that’s right for you while helping you avoid unpleasant billing surprises.

The premium is the amount you’ll pay, generally on a month to month or semi-annual basis, for coverage. This amount may vary dramatically depending on the plan and level of coverage. In order to get the best premium price, you may need to shop around and get quotes from a number of different insurance providers. You may also adjust certain insurance options such as your deductible and co-insurance level, since both can ultimately affect the size of your monthly premium.

Health insurance premiums are often based on many factors. Non-smokers and those who have a BMI, or body mass index, in a normal weight range, tend to be healthier overall, so they often have access to lower premium rates than those who may have higher risk habits or lifestyles. Other factors that often play into the cost of your insurance premiums are your age and your sex. Older individuals and women tend to pay more for family health insurance than younger people and men do.

The group health insurance plan with the lowest monthly premium may not necessarily be the best option for you. If it is associated with a lower level of coverage when you require a higher level of coverage, you may be better off spending more every month for the higher priced PPO health insurance plan with more coverage.

A lot goes into choosing the right HMO health insurance plan. Although your monthly premium may play a major role in your decision, it’s also critical that you consider other aspects of the policy, including the level of coverage and associated out-of-pocket expenses.

 

Source: Health Coverage Los Angeles

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