Skip to main content

Purchase Health Insurance with Credit Cards

 

Purchase Health Insurance with Credit Cards

Health insurance is critical for everyone. Unlike earlier times when you had to make cash or cheque payment for your health insurance, nowadays, insurance companies accept credit card payments towards health insurance premiums. In fact, with the widespread use of plastic money, this form of payment is becoming more and more popular. But how sensible is it to purchase your health insurance through a credit card? What are the benefits and drawbacks?

 

Why should you do it?
The biggest advantage while making your premium payment through credit cards is that your bank balance will not go down immediately. That is, you can delay the outflow of cash from your account. You can also earn points on your credit card for this expense. If you have taken a substantial health cover, then your premiums also will be high. This means that you can earn higher number of reward points for your purchase. But should you opt for a credit card payment simply because you can delay the cash outflow and earn points? It can be quite disastrous if you are not careful with your credit card. Here's what can go wrong when you pay through credit cards.

 

Things you should take care of:
Auto-mode: First, you will need to ensure that the payment is not in the 'auto-pay' mode. That is, most insurance companies ask you if you wish to automate your health premium payments every year and if you choose 'yes', then the amount is deducted from your credit card account every year. Although this looks like a good way to avoid missing deadlines, it is better not to opt for this. If you are unhappy with the health insurer's services, you can port your policy to another insurer. Automating premium payments through credit cards can make the process complicated if you want to shift your health provider. Also, sometimes, premiums are increased without informing the policy holder and this increased amount is debited from your credit card account. Sharing your credit card details with the insurer and authorising a third party to debit your credit card account is not advisable under any circumstance. Hence, this should be avoided.

 

Additional Charges: Next, when you make your purchase through the credit card, you will be charged an extra fee over and above your premium amount. This may either be a percentage of your premium amount or a flat fee. The amount of fee charged varies from one service provider to another. Nevertheless, all credit card payments entail a transaction fee. This is because the health insurance company will in turn have to pay the credit card company. This extra fee you pay may look like a small amount. But why pay extra when you can opt for other payment methods which do not carry any extra fee?

 

Missing deadlines: Third, as in the case of any other credit card payment, if you do not pay your credit card dues on time, you will end up paying a hefty interest rate. In addition to this, you will be charged a late payment fee as well. The amount you end up paying extra will be much more than what you think you are saving by opting for this payment mode.
If you think you will not be able to pay the premium amount on your credit card in one lump sum and want to opt for an Equated Monthly Instalment (EMI) payment on the card, then think twice. Such EMI schemes have an inbuilt component of interest, and you may end up paying much more than your premium amount. This should also be avoided.

 

Thus the verdicts of whether or not you should purchase health insurance through credit cards depend on how financially disciplined you are. If you are careful in how you use your card and are prompt in your payments, you can use your credit card for your health insurance. Otherwise, it is better to stick to conventional payment systems like cash or cheque.

For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

Leave a missed Call on 94 8300 8300

Leave your comment with mail ID and we will answer them

OR

You can write back to us at

PrajnaCapital [at] Gmail [dot] Com

---------------------------------------------

Invest Mutual Funds Online

Invest Any Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Download Mutual Any Fund Application Forms

---------------------------------------------

Best Performing Mutual Funds

    1. Largecap Funds Invest Online
      1. DSP BlackRock Top 100 Fund
      2. ICICI Prudential Focused Blue Chip Fund
      3. Franklin India Bluechip
      4. ICICI Prudential Top 100 Fund

B. Large and Midcap Funds Invest Online

      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
      4. Birla Sun Life Front Line Equity Fund
      5. Franklin India Prima

C. Mid and SmallCap Funds Invest Online

      1. Reliance Equity Opportunities Fund
      2. DSP BlackRock Small & Midcap Fund
      3. Sundaram Select Midcap
      4. IDFC Premier Equity Fund
      5. Birla Sun Life Dividend Yield Plus
      6. SBI Emerging Businesses Fund
      7. HDFC Mid-Cap Opportunities Fund
      8. ICICI Prudential Discovery Fund

D. Small and MicroCap Funds Invest Online

      1. DSP BlackRock MicroCap Fund
      2. Franklin India Smaller Companies

E. Sector Funds Invest Online

      1. Reliance Banking Fund
      2. Reliance Banking Fund
      3. ICICI Prudential Banking and Financial Services Fund

F. Tax Saver Mutual Funds Invest Online

1. ICICI Prudential Tax Plan

2. HDFC Taxsaver

      1. DSP BlackRock Tax Saver Fund
      2. Reliance Tax Saver (ELSS) Fund

G. Gold Mutual Funds Invest Online

      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund
      4. Birla Sun Life Gold

H. International funds Invest Online

1. Birla Sun Life International Equity Plan A

2. DSP BlackRock US Flexible Equity

3. FT India Feeder Franklin US Opportunities

4. ICICI Prudential US Bluechip Equity

5. Motilal Oswal MOSt Shares NASDAQ-100 ETF

Popular posts from this blog

Mutual Fund Review: Religare Tax Plan

Tax Plan is one of the better performing schemes from Religare Asset Management. Existing investors can redeem their investment after three years. But given the scheme's performance, they can continue to stay invested   Given the mandated lock-in period of three years, tax saving schemes give the fund manager the leeway to invest in ideas that may take time to nurture. Religare Tax Plan's investment ideas revolve around 'High Growth', which the fund manager has aimed to achieve by digging out promising stories/businesses in the mid-cap segment. Within the space, consumer staples has been the centre of attention for the last couple of years and can be seen as one of the key reasons for the scheme's outperformance as compared to the broader market. It has, however, tweaked its focus and reduced exposure in midcaps as they were commanding a high premium. The strategy seems to have worked as it returned a 22% gain last year. Religare Tax Plan has outperformed BSE 100...
Read more

Mutual Fund Review: L&T MIP

        This fund won't deliver chart-topping returns. However, over the long run it will not disappoint and end up beating the category average The fund has seen numerous changes at the helm. When Katare took over in October 2007, he made dramatic alterations to the portfolio. On the equity side, he increased the number of stocks to 11 (November) from 2 (September). On the debt side, he added Certificates of Deposit (CDs), while earlier Treasury Bills (T-Bills) and cash accounted for 88 per cent (September 2007) of the portfolio. In November 2007 he exited T-Bills for good. The results impressed. In the last quarter of 2007, it delivered 12.83 per cent (category average: 6.12%). In 2008, the first quarter performance was nothing short of impressive, a return of 9.93 per cent (category average: -3.97%). While other players increased their portfolio maturity, Katare maintained a low maturity profile. While the average maturity of the category was 2.81 years that quarter, th...
Read more

PF e-Passbook

  Provident Fund e-Passbook   The Employees Provident Fund Organisation now runs an e-passbook service that enables members to log in and access their provident fund accounts . This facility enables tracking of the money and ensuring that the employer's contribution has been deposited into the account. This facility is available to those whose accounts are with the central provident fund commissioner for maintenance and can be availed at members.epfoservices.in . Registration A member can register at the portal easily by using PAN , Aadhar or passport number as the log in and the mobile numbers as the PIN . This combination enables easy retrieval of information. Accounts After logging in, the member has to choose the state where the employer is located, and enter the code number of the employer, account number and name. These details can be obtained from any existing PF document . PIN To download the passbook, the member will request...
Read more

Mutual Funds: Past Performance is not just everything

Many a times your agent / distributor / relationship manager tries to push you some mutual fund schemes by enticing you with a typical sales pitch…"Sir, this scheme has generated 20% returns in the past one year." And this sales pitch often gets louder when the market conditions have been favourable. Some of the agents / distributors / relationship managers have another unique way of luring you. They say, "Sir / madam this scheme has been awarded the best scheme award in the past by a leading business channel"... And hearing all these sales talks you investors very often get attracted and sign a cheque in favour of the respective scheme.   But please ask yourself do you hear these sales talks when the capital markets turn turbulent? Why is it so that your agent / distributor / relationship manager avoids talking to you during turbulent times of the capital markets and doesn't boast about returns generated by the respective funds or awards being conferred on t...
Read more

Reconfigure investments to reap benefits in DTC

    Investing for tax benefits under the new Direct Taxes Code ( DTC ) will be different in several ways from what taxpayers are familiar with right now. This will require some reconfiguration in the nature of investments for the investor and they need to be ready to tackle the changes that will come about once the new DTC is implemented from financial year 2012-13.One area of interest for most taxpayers is the manner in which they can extract the maximum tax benefit. Here is a look at the situation and also how it changes from the existing position. Basic deduction: At present, there is a deduction of Rs 1 lakh that is available for an individual when they make investments under specified areas such as provident fund, public provident fund, national savings certificates, equity linked savings scheme and insurance premium, among others. This benefit is available under Section 80C of the Income Tax Act. This has been replaced by a new Section 68 under the DTC where there is a deduct...
Read more
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now