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What Factors Contribute to Your Monthly Premium?

What Factors Contribute to Your Monthly Premium?

We all know purchasing a health insurance policy can be expensive, even if you manage to get a decent rate. Believe it or not, you actually have some control over your costs. While you may not be able to lower your premium by hundreds of dollars, almost everyone is capable of at least slightly decreasing their prices. That can make all the difference when every penny counts. Read about these important factors that help determine premiums and see how you can possibly get lower rates.

  • One of the most important factors in determining the amount you will pay for coverage is your deductible. Your deductible is the amount you have to pay out of pocket before your provider can reimburse you for expenses. Of course, it's nice having a low deductible and not having to pay much out of pocket, but that will typically lead to higher premiums.
  • In order to cap the total amount of deductibles you have to pay, some providers may offer annual deductible limits. That can be a great benefit, allowing you to plan out the total amount of deductibles you'll pay for the entire year. However, these usually add to the cost of your policy too. In this case, the lower the cap, the higher the cost.
  • Some policies have a life-time maximum in regards to the amount of expenses they will pay for you during your lifetime. Generally, the higher your maximum, the higher your costs.
  • With certain policies, your provider may guarantee future renewals at your current pricing. This provides you with peace of mind, knowing you won't have to search for a new policy at a different price, but the protection is built in to the current costs of your plan. You may also be able to take out a non-cancellation clause, in which your insurer can only terminate your policy for non-payment.
  • Do you already have other types of insurance such as home or auto? Depending on your carrier, you may be eligible for a discount for using the same company.
  • Like almost every other form of coverage, many carriers use your credit score as a rate factor. Obviously, the higher your credit score, the better your chance of getting discounted premiums. Before you apply, get a copy of your credit report and see how you can increase your score.

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