Obesity Is Not Just Bad For Your Health, It Can Also Drive Up Your Health Insurance Premiums

According to a recent research report by Lancet, 12.5 million children (7.3 million boys and 5.2 million girls) in the country, aged between five and 19, were grossly overweight in 2022, up from 0.4 million in 1990. The new study reveals that 44 million women and 26 million men aged above 20 in India were found to be obese, this figure being 2.4 million women and 1.1 million men in 1990. These are alarming figures at a time when there are many cases of detrimental diseases such as stroke or heart disease.

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People with obesity tend to experience longer hospital stays and are more susceptible to certain chronic conditions as compared to individuals with a healthy lifestyle. Moreover, they are at a higher risk of developing chronic conditions such as diabetes, and heart disease, and are relatively more prone to strokes.

“As a result, these individuals have a higher hospitalization rate which increases the average medical bill amount. To account for the increased healthcare costs, the insurance companies charge a higher premium, called the loading fee,” says Rupinderjit Singh, senior vice president, retail health, ACKO, a general insurance company.

How Premiums Are Affected

Specific body mass index (BMI) thresholds can affect both the customer’s eligibility for coverage and the premium rates. Each insurance company uses its underwriting guidelines to determine these thresholds. If the customer’s BMI falls above a certain level, they may be charged a higher premium, and, in extreme cases, either have restricted coverage or the insurer may decline coverage altogether.

While BMI can significantly impact insurance premiums, the exact increase depends on the insurer and the type of policy being considered. For example, individuals with a BMI of 25 may not warrant a loading charge from insurers. “Those who have a BMI between 25 to 29, may face a loading fee of 10 per cent to 20 per cent based on the insurer or an insurance product,” says Singh.

Generally, insurance companies increase the premium at a member level for the individual with a higher BMI instead of a generic loading for the entire family premium. “For example - for a family of four if a member is obese can increase the premium by 20-40 per cent every year,” says Singh.

Coverage Remains The Same, With Exceptions

While coverage for most medical conditions remains the same regardless of weight, there can be exceptions. Insurers may exclude coverage for certain procedures, such as bariatric surgery for an individual with a BMI of less than 37. Otherwise, there is no specific limitation to the cover for obese individuals if the cover is extended.