How Do We Calculate Premiums

Your insurance premium

 

 

Is your insurance premium reasonable?

Is your price fair?

Can we do anything to lower your insurance costs?

What is the professional process that calculates the price of your insurance plan?

It is important for us to establish credibility around our pricing policy, and to make sure you know we are doing everything we can to control the price and keep it as fair and affordable as we possibly can.

Please see the main points below:

What is an insurance premium?

This is the name we call the sum of money you pay for your chosen insurance plan.

Your quarterly or half-yearly payments are related to your chosen way to pay.

You’ll see that your premium payments depend on the plan and option you have selected.

To avoid unnecessary surprises, you should double-check that you have chosen the correct plan, what is covered, and that you can afford to pay the premium to cover it.

   

Your personal premium calculations?

The main elements include your personal data, such as your age, where you live, whether you wish to have your family on your plan, and level of coverage you wish to obtain will influence the cost of your insurance plan. To this, we are forced to include additional factors which influence the cost of health care, and which can have an influence on the financial management of your plan. These include

·       Inflation

·       Events such as the COVID-19 pandemic

·       The cost of expensive and lengthy new drug and treatment therapies

This means that we have to be very precise when we calculate insurance premiums. We are aware of the fact that customers and brokers we work with are much more sensitive to premium increases than before. So, you should remain confident that our premium management is carried out with much care and attention as it is in our best interest to keep your premium low.

We work closely with our insuring partners (those who share the risk with us) to make sure you don’t have an unpleasant surprise when you receive your Policy Renewal Invitation each year.

Get to know the basic way insurance works:

·       Premiums increase as you get older

·       Making claims does not affect your premium

·       Your country of residence can make a difference

·       Your premium depends on the level of coverage you want

·       Regional, and global factors affect the cost of private healthcare

Premiums increase as you get older

Typically, your age-related premium increase will be around 3% per annum until you reach the age of 65. This percentage can be higher or lower depending on where you live, and the percentage increase will increase as you get older. Between the ages of 65 and 80, your age-related annual premium increase will be no greater than 6%.

Age is not the only factor that affects your premiums. Where you live, the level of coverage you want, and the actual cost of private healthcare also make a difference. So, your total premium increase will be higher than your age-related premium increase. 

Claims won’t affect your premium

Unlike some providers, we won’t increase your renewal premium if you’ve made a claim. Members purchase an insurance policy in good faith, so we don’t think it is fair to penalise them for legitimate claims.

Instead, we use what’s known as a community-based model. We average the money we pay out in claims across all our members, so no one person or group of people has to suffer.

The country you live in

Premiums for health insurance are higher in countries where private healthcare is more expensive.

Directly and through our insuring partners, we are working closely with the leading private hospitals and clinics in pretty much every country on the planet. We know the doctors and specialists, we know how they like to work, and we know how much they charge for different medical treatments.

When we compare these charges to global averages, we begin to get a clear a picture of which cities, countries, and regions are expensive, and which are cheaper. We have decades worth of claims and medical data to help us accurately form our pricing model.

Of course, things change all the time. The cost of private healthcare in a country or region can skyrocket very quickly. Treatment for medical conditions in Switzerland and Belgium are as costly as they are in the United States of America. That simply wasn’t the case when we started our operations.

It is also true that international health insurance gives you cover for medical treatment in multiple countries, so we don’t calculate your premium solely according to the country in which you are currently living. For example, residents in Hungary or Poland, would typically travel to Germany or Austria for elective hospital treatment owing to these latter countries having better medical facilities.

Your premium depends on the coverage you want

If you want health insurance with a low excess (an excess is the agreed amount you will pay towards any medical treatment claim) and all the bells and whistles, you’ll have to pay more. Conversely, a plan with capped limits and fewer options won’t cost you so much. A policy with your co-payment (access) may reduce your premium.

For us, the most important thing is that you have the cover that you need. We are not keen on ‘upselling’ and we will never encourage you to purchase a more expensive plan. We’re just happy to have you as a member.

Regional, and global factors affecting the cost of private healthcare

·       Medical inflation – The inflation rate for private healthcare is consistently higher than general inflation. The ever-increasing demand for healthcare means that hospitals and clinics can charge higher prices. The costs of drugs and new sophisticated diagnostics procedures and treatments influence the cost of insurance premiums.

·       Cancer treatment costs – Increasing life spans mean that more people will have cancer at some point in their lives. Substantial investment in developing safer and more effective therapies has improved treatment outcomes. However, these therapies are often costly and can last for many years.

·       NextGen drug therapies – There are exciting advances in the field of medical technology, which are improving healthcare outcomes, but these are extremely expensive treatments.

·       The Coronavirus – The pandemic has caused unprecedented disruption and placed an extraordinary strain on healthcare systems around the world. It is a standard view that this strain will adversely affect hospital prices as they try to recover from COVID-19 disruption in the coming years.

Being fair to our members

Unlike other insurance providers, it is in our best interests to keep premium increases low!

Private healthcare is expensive and, as costs go up, health insurance premiums have to keep pace. We do everything possible to keep premium increases to an absolute minimum, and we’re completely transparent about how we calculate your premiums.

We are working with our insuring partners to secure the fairness of our pricing and also to offer you plenty of options to help reduce your insurance premium, if necessary.

Healthcare is a highly personal experience, so it deserves a personal service. There is a team of real people at the other end of the telephone line when you need us. Give it a try…

We also have a fantastic team in place who are here to help you during the lifetime of your plan, when it’s time to renew it, or when you need medical treatment. We’re smaller than global insurance conglomerates, but we like it that way as this means we can give each of our members much more personal attention. 

Money-back guarantee

Whether you’re purchasing a new plan or you’re renewing your current plan, you can cancel it for any reason within 30 days of purchase or renewal. We’ll give you a full refund, provided you haven’t made any claim(s).

COVID-19

We know it’s tough out there, what with restrictions on personal freedom, impending economic recession, and everything else the COVID-19 pandemic entails. We’re here to help you through this period, so if you want to discuss your plan with us, please get in touch! We’ll be happy to help.