How health insurance premium prices vary based on gender

Gender plays a role in determining health insurance premiums due to variations in medical needs and conditions between genders. Insurance companies assess risks based on factors such as age, pre-existing conditions, and gender to determine premiums. Women, for instance, may have higher healthcare costs due to factors like pregnancy and reproductive health needs, while men may have different risk profiles based on other health considerations. 

While this practice has faced scrutiny for potential discrimination, insurers argue it reflects actuarial data showing differing healthcare costs between genders. Despite ongoing debates regarding fairness and equality, gender remains a factor in setting health insurance premiums, influencing the overall cost and coverage individuals receive. Want to know how health insurance premiums vary based on gender? Read ahead to find out.

Medical treatment or needs differ between men and women. As per a 2014 survey by ASSOCHAM India, about 42% of working women were found to be suffering from chronic, lifestyle, and acute ailments such as chronic backache, depression, obesity, hypertension, heart, kidney disease, high cholesterol, etc.

Men, women are more likely to seek medical insurance for coverage specific to their medical conditions, such as maternity cover for women, and stress-related illness cover for men. Some gender may require frequent doctor visits as compared to another gender. For example, women may need to frequently visit a doctor during maternity.

With women requiring to visit doctors and medical treatments, the chances of filing regular claims are higher than men, especially during childbearing age. As for men, the probability of falling ill during the latter part of their years is higher.

In other words, the medical expenses are based on the requirement of the gender and medical condition of the individual and thereby, impacting the health insurance cost.

While there is a difference in the premium for all genders, the difference is not significant. The premium depends on the type of health insurance plan that you choose. Health insurance plans are designed to meet different needs; therefore, several insurers customise plans to meet various needs.

Some insurers even curate health insurance plans that are gender-specific to meet the policyholder’s specific needs better.

Gender rating in health insurance refers to the practice of charging different premium rates based on the policyholder's gender. Insurers adopt risk-based pricing strategies to evaluate morbidity, accident, and mortality risks, with gender being one of the factors influencing these risks. The rationale behind gender rating stems from the differences in medical conditions between men and women, impacting the frequency of insurance claims.

Typically, health insurance plans tend to impose higher premium costs on women of childbearing age than men. This is because women are statistically more likely to incur medical expenses related to pregnancy, childbirth, and certain gender-specific conditions such as breast and ovarian cancer. Therefore, insurers adjust premiums to account for the higher likelihood of women requiring medical care during their reproductive years.

However, as individuals age, the dynamics of risk change. After the age of 60, premium costs for women may start to decrease even more than those for men. This shift occurs because women generally have longer life expectancies than men and are less prone to certain age-related illnesses that are more prevalent in males, such as heart disease and prostate cancer. Consequently, insurers adjust premiums to reflect the varying claim costs associated with gender and age demographics.

It's important to note that the practice of gender rating has been a subject of debate and scrutiny. Critics argue that it perpetuates gender-based discrimination in healthcare access and affordability. Women may perceive the higher premiums during their childbearing years as unfair, particularly if they are financially penalised for biological factors beyond their control. Advocates for gender-neutral pricing advocate for a more equitable approach that focuses on individual risk factors rather than broad generalisations based on gender.

In response to such concerns, some jurisdictions have implemented regulations to restrict or prohibit gender rating in health insurance. These regulations aim to promote fairness and equal access to healthcare coverage regardless of gender. However, insurers must continue to assess and manage risks effectively to ensure the sustainability of their insurance products while adhering to regulatory requirements and addressing societal expectations for fairness and inclusivity in healthcare financing.

The benefits and features of gender-based health insurance plans are designed to meet the custom health requirements of different people. Hence, many insurers have started offering women-centric health insurance policies to cater to their unique needs. A health insurance plan designed specifically for women will cover breast cancer, maternity, cervical cancer, etc. These coverages will be either built-in or will be offered as an add-on. 

Women can get the proper medical care during such situations without worrying about the medical cost for these specific medical needs. Likewise, some policies are specific for men with coverage for diabetes, stress-related medical conditions, hypertension, etc.

According to a 2019 report from the Insurance Information Institute (III), an organisation supported by the industry for consumer education, insurers rely on actuarially sound variables derived from statistical analysis and approved by regulators to set rates. When one variable, such as gender, is restricted, insurers must compensate by adjusting the weighting of other variables.

However, this shift in rating variables could lead to unintended consequences. Lower-risk customers may end up subsidising higher-risk customers. This outcome occurs when insurers adjust rates to balance risk across their customer base without the ability to differentiate based on certain factors like gender.

Critics argue that such adjustments may undermine fairness in pricing and result in cross-subsidisation, where certain groups of policyholders bear the financial burden of higher-risk individuals. Additionally, there are concerns about the potential for discrimination or bias when insurers rely heavily on proxy variables that may indirectly correlate with sensitive characteristics such as gender or race.

While stricter regulations on gender rating aim to promote equality and fairness in insurance pricing, they also pose challenges for insurers in accurately assessing and pricing risk. Finding the right balance between regulatory oversight and ensuring actuarial soundness remains a complex issue in the insurance industry, with implications for both insurers and consumers alike.

To sum up, health insurance premiums are not primarily determined by gender. Age, location, existing medical conditions, etc., are other important factors that affect the premium. The difference in premium amount based on gender is minimal and not significant. Apart from medical emergencies, you need to select the right health insurance plan that suits your requirement. If you foresee medical conditions that may require special care/attention, you need to choose a suitable plan based on your specific requirements.

Just as health insurance is essential for safeguarding the well-being of your family by covering unforeseen medical costs, life insurance protects their long-term finances in emergencies. 

Life insurance is a vital step in ensuring your family’s financial stability. Plans like term insurance are excellent choices if you are seeking cost-effective coverage. A 1 crore term insurance plan provides great financial stability at a low cost. If you’re considering purchasing a term plan, ensure to use a term life insurance premium calculator to make informed decisions. This tool allows you to find the right coverage and calculate premiums based on your budget and lifestyle, making the procedure simple and hassle-free.