Understanding Deductibles and Premiums in Family Health Insurance

Buying family health insurance plan is among the wisest moves to protect family and finances in medical emergencies. But the premium associated with a comprehensive medical policy often makes one hesitant, especially if their family harbours a hospitalisation history or pre-existing health conditions. 

However, policyholders can raise the deductible to bring it within the budget. Many remain unfamiliar with what a deductible and premium mean and why insurers pitch these ideas. This article provides an in-depth insight into deductibles and premiums and explains how they work.

What are the Types of Deductibles?

Deductibles in health insurance family plans are primarily of two types:

1. Compulsory Deductible

It is an amount set by the insurance company that the insured must pay when making a claim. It can also be a percentage of the sum insured. Since the deductible amount is fixed, it does not impact the policy premium.

2. Voluntary Deductible

It is an amount chosen by the policyholder to pay from their own pocket when making a claim. Voluntary deductibles suit those who do not frequently make claims and want to reduce their healthcare insurance premium.

How do Deductibles Work?

When purchasing family healthcare insurance, individuals pay a fixed monthly premium for one year of coverage. They can renew their coverage at the end of the year, but the insurer may adjust the premium amount.

The annual deductible is a separate cost from the monthly premium. It represents the amount individuals must pay for covered services before the insurance company covers expenses. For example, if a plan has a ₹10,000 annual deductible and a covered individual requires a procedure costing ₹30,000, they would need to pay the ₹10,000 deductible, and the insurance company would cover the remaining ₹20,000 of the cost, provided the procedure is within the coverage.

Once the deductible is met and as long as individuals continue paying their premiums, their medical expenses are covered. If the policy is renewed for the following year, the deductible must be paid again before the insurance plan begins covering costs.

What are the Advantages of Deductibles?

While deductibles in a best health insurance plan for family may seem like an additional expense, they can offer various benefits.

1. Premium Reduction

Deductibles can lead to a reduction in insurance premiums. Insurers may offer lower premiums when policyholders agree to cover a portion of the claim costs themselves.

2. Discount Incentives

Some insurers provide discounts when policyholders choose to pay deductibles. The discount reflects the reduced financial burden on the insurance company.

3. Prevention of Small Claims

Deductibles discourage policyholders from making small claims. It enables policyholders to accumulate a No Claim Benefit (NCB) over the healthcare insurance family policy year.

How Does Premium Work?

Premiums for family healthcare insurance can vary significantly based on several factors. These factors include age, location, and the type of plan chosen. It is essential to note the premium will be based on the age of the oldest member covered.

Insurance companies annually decide the premium rates for family health insurance plans, and they typically need to submit these rates to the relevant state authorities for approval.

How Does Premium Impact Your Family Healthcare Insurance?

Every family healthcare insurance plan comes with a varied premium amount. Insurers conduct a thorough assessment before approving and determining the charges. Here are some factors they consider to calculate the premium:

1. Age

It is a significant aspect that affects the premium amount. Insurance companies typically follow the general rule: the higher the age, the higher the premium. Insurers consider the age of the oldest member to set a price.

2. Past Medical History

The past medical records of a family are vital for deciding the premium amount. The premium will likely be higher if any covered family member suffers from a pre-existing disease or has a history.

3. Occupation

The nature of work and the risk level influence the premium charges. For instance, the premium will be less if the policyholder works in a school. Conversely, it will be higher if they work at a construction site or a factory.


Everyone deserves the best protection. Several factors, including medical histories, current health conditions, lifestyle choices, and overall physical well-being, influence the cost of family health insurance plans coverage. Therefore, one must thoroughly review all healthcare insurance details and comprehend the terms before purchasing a plan or premium.

Niva Bupa Health Insurance is one such ideal option. It is known for expert guidance and offering reasonable deductibles and premiums for health insurance family plans. Get started now to secure health for your family confidently.

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