Health Insurance Articles

Why Adult Healthcare Insurance May Be Cheaper Than For Children

2011-05-10

A health insurance plan is typically cheaper for children than adults; according to several studies. This is for several reasons; but mostly because children are seen as healthier and less prone to severe health problems like diabetes, heart disease, kidney failure and many others. As such, depending on the health insurance plan, insurance for children is usually quite low. But there are numerous reasons for what some experts believe to be a change in this type of trend; with adult health care insurance sometimes working out cheaper.

Here is one reason. Insurance companies base monthly premiums on one main factor; risk. Namely; what the chances are that the person will actually make a claim, or in the case of health care; the chances that they will fall sick and need medical assistance. Insurance companies usually work on a 60/40 ratio; which means that forty cents on every dollar received goes toward overhead and company profit. Which means that if more than 60% of their clients call on their policies; the company will face serious problems.

Because of this, these companies spend millions of dollars keeping professional risk adjusters on the payroll. In the case of health insurance, they will examine such aspects as family health, medical records and other basic items. What they also evaluate are lifestyle issues as well, such as if you smoke, drink, are overweight, do not get enough exercise and even where you live (an area with a high crime rate means a higher chance of injury resulting from criminal activity).

While adults are usually seen as a higher risk while evaluating these factors; this is not always the case. Obesity among children is increasing in America at exponential rates, the advent of the internet and video games means less time spent getting enough exercise to keep oneself healthy. Children are also extremely prone to accidents, either through simple clumsiness or by performing daredevil stunts. One popular example, Parkour, is an exercise which involves climbing and jumping and has become a craze amongst teenagers; unfortunately leading to accidents in many cases. Activities like this increase the risk factor in many cases for children and teenagers, which will increase the premiums on any health insurance plan.

The fact is that healthcare costs are rising all around in the USA. A recent report stated that the US spends the highest amount (per individual) on healthcare, than any other country, which means that health insurance will also rise. There are many ways to keep costs down, which include eating healthy, avoiding smoking and frequent drinking and getting exercise. If you live a healthy lifestyle; you will find your health insurance plan costs lower and your health much better.