What are the factors that affect visitor insurance premiums in the US? 

What are the factors that affect visitor insurance premiums in the US?

Are you planning to buy a visitor insurance plan before traveling to the US? No insurance plan fits all because everyone needs a different level of coverage based on their trip durations, activities they plan to do, and health. While buying a visitor insurance plan, one must know that the premium is calculated based on a daily rate. So, the premium will increase if you stay longer in the US. However, four significant factors determine your plan’s premium. These are age, length of stay, policy maximum, and deductible. Let us discuss them further. 

1. Age 

Age plays one of the crucial roles in determining the policy’s premium. Typically, younger adults pay a lesser premium than seniors for the same plan. For example, the premium for Safe Travel USA Comprehensive is $39 for a 25-year-old individual for a 30-day plan with a $100,000 policy maximum and a $500 deductible. In contrast, for the same plan with a $100,000 policy maximum and $500 deductible, a 65-year-old individual will pay $166.20. The premium for senior adults is higher as the risk involved with them is also higher, and the chances of a claim are higher. Therefore, as age increases, the premium also increases.  

2. Duration of the trip 

The premium is calculated per day, so it directly relates to the trip’s duration. For instance, staying in the US for a month will cost you less than staying for a year. You are exposed to more risks and travel interruptions while living in the US for an extended period. The longer you stay, the more premium you must pay. A 25-year-old individual must pay a premium of $239.20 for 6 months with the Safe Travel USA Comprehensive plan for $100,000 and a $500 deductible. In comparison, the premium for 30 days is only $39. 

3. Policy maximum 

Every plan has different options for policy maximums. Coverage can start from $50,000 to $2 million and go up to $8 million. Depending on your travel and medical needs, you can choose a policy maximum. The higher the policy maximum, the higher will be the premium. For example, a 25-year-old individual will pay a premium of $59.70 for a 30-day Safe Travel USA Comprehensive plan with a $1 million policy maximum and a $500 deductible. Whereas the same plan with the same coverage options, a 25-year-old will pay $39. 

4. Deductible 

 The deductible affects the premium of the plan but not the benefits. Each plan has different deductibles, and you can select a value as per your choice. For example, if a 25-year-individual chooses a 30-day Safe Travel USA Comprehensive plan with a $1 million policy maximum and a $2,500 deductible, he pays a premium of $46.50. But if he chooses a $500 deductible and the same variables, he pays a $59.70 premium. So, the premium increases with a lower of deductible. 

Apart from these factors above, other factors can change the cost of the insurance plan. These are level of coverage, destination, optional add-ons, type of plan, etc. Let us understand them, as well. 

a) Plan type 

Visitor health insurance plans are of two types– comprehensive and fixed-benefit. The comprehensive plans have a higher premium but offer better protection. If you choose a robust, comprehensive plan, you do not have to worry about paying medical expenses from your pocket because the plan will cover you till your selected policy maximum. Suppose your policy maximum is $1 million, and you are hospitalized. The plan can cover you up to $1 million for hospitalization charges if it is an eligible expense.

The fixed benefit plans are economical but offer lesser protection. The policies come with sub-limits and do not cover you till the policy maximum as each benefit has a sub-limit. For example, if the plan covers $1,000 per day for hospitalization bills, and if the hospital charges $1500 per days the plan will cover up to $1,000 expenses and the rest will be out of pocket.  If the bill accounts for $5,000 for two days, your plan will pay $2,000 as overall charges, and you will be asked to pay the rest. However, if you choose a fixed benefit plan, you will be paying a much lesser premium than a comprehensive plan. 

b) Coverage type and level 

The type of coverage you choose will also change the rate. A basic plan will naturally cost less than one that includes many optional benefits like Cancel for Any Reason, adventure sports, personal liability, crisis response, or rental car collision coverage. Similarly, higher coverage limits for medical expenses or evacuation will increase the premium of a plan. In short, the more protection you choose, the more premium you will pay. Adding optional benefits will also increase the premium. 

c) Destination 

As the US has the highest medical facility, the medical expenses are also high than in other countries. Therefore, the travel medical insurance needed for visitors traveling to the US is more than traveling to Asian countries. Though the destination has no direct relationship with the plan cost, it can be a deciding factor in choosing the policy maximum and level of coverage. For example, the kind of protection a traveler needs for hiking in the Alps is vastly different from that required by a family taking a short cruise to the Bahamas. 

d) Number of travelers 

The more number of travelers, the higher will be the premium. If you travel alone, your insurance plan’s premium will be lower than traveling in a group or with your family. For instance, a 30-year-old individual will pay $271.20 for a 30-day Safe Travel USA Comprehensive plan with a $1 million policy maximum and a $500 deductible if he brings his 30-year-old spouse and two dependent kids. He will be paying $39 for the same variables if traveling alone. 

Choose the right visitor insurance plan! 

The plan rate should not deter you from purchasing the coverage you feel you need to protect your trip entirely. NRIOL.net has hundreds of plans for all different types of travelers. Therefore, it is important not only to compare travel insurance rates but also the level of coverage. This will ensure you find the right travel insurance plan for your trip. 

Do not be swayed by a lower-priced plan with benefits that do not suit you entirely or, likewise, high-priced plans that overinsure your trip. It may seem confusing and challenging at first to find the right plan. This is where we help travelers and visitors. Call us to know more!