How to Save on Family Health Insurance Premiums

Healthcare costs in India are skyrocketing, and what's worse is that it's happening at a pace where incomes cannot keep up. GOQii's India Fit Report for 2025 states that as a result, nearly 1 in 5 Indians are skipping treatment entirely due to cost concerns.

It's no wonder that Vishal Gondal, Founder and CEO of GOQii, stated, The rising cost of healthcare is not just a statistic—it's a silent emergency unfolding in households across India.

With rising pollution levels and stagnant lifestyles contributing to unexpected illnesses and the aftereffects of COVID slowly unfolding, having adequate insurance coverage is the only effective countermeasure to the situation. That said, insurance premiums are also not cheap, and knowing how to save on family health insurance premiums is now essential for most families. 

The silver lining is that several budget-friendly health insurance options are available on the market today, and there are multiple ways to reduce premiums without compromising coverage. This blog will tell you how.

9 Ways To Reduce Family Health Insurance Costs

There are several ways to save money on family medical insurance without compromising coverage. Let's start with the basics, using the right structure for family coverage.

1. Opt for a Family Floater Plan

A family float plan is a cost-effective health insurance option for families. It is, in essence, a single insurance plan that can cover you, your spouse, and your dependents (including children and aging parents) under one consolidated sum insured.  

When comparing family floater plans to individual plans, several advantages become apparent. The first is that the premium of a floater plan is significantly lower than the sum of the premiums of separate individual plans for each family member. This is because, from the insurer's POV, the risk is spread across members, especially when the family is young and generally healthy. 

The second and most important factor is that you just have one premium to pay and renew on time, which lowers the risk of any policy lapsing due to missed payments. 

2. Start Early and Lock in Lower Premiums

The cost of health insurance is directly linked to your age. This is because the insurance industry works on the assumption that the younger you are, the lower your risk factor and hence the lower the likelihood of you filing claims.

One of the best tips to lower health insurance premiums is to enroll in a health insurance plan (compare family floater vs. individual plans to determine which is the best fit for you) early on. Since the possibility of pre-existing conditions is also lower at a younger age, you also get more comprehensive coverage.

3. Choose An Adequate But Not Excessive Sum Insured

The next way to save money on medical insurance for your family is to not over-insure yourself. If you are a new family with no pre-existing conditions, paying high premiums, especially when you are least likely to utilize the coverage it provides, is not a wise use of your money. 

For a young, healthy family of four, a base cover of ₹5–10 lakh is usually sufficient. But if you do have family members with pre-existing conditions, or live in a metro city with higher hospitalization costs, only then should you opt for a higher sum insured.

4. Use Super Top-Up Plans for High Coverage

If you do find the need to increase your sum insured, super top-ups are affordable family health insurance plans that help you do that without inflating your premiums.

A super top-up plan is an add-on insurance plan (above your base plan) that activates only after a certain threshold of expenses (known as a deductible) has been crossed.

For example, if your base family floater is 5 lakh and you take a super top-up of 10 lakh with a deductible of 5 lakh, you effectively have a total coverage of 15 lakhs. This approach will cost you significantly less in premiums than having a base policy with a sum insured of 15 lakhs. 

One point to note when opting for super top-up plans is to ensure that the deductible amount matches the deductible amount of your base plan. Otherwise, the difference (between the coverage of the base plan and the deductible limit) will come out of your pocket.

5. Consider Co-Pay Or Deductible Options

Co-Pay or Deductible options are another way to reduce family health insurance costs. A co-pay clause is an optional feature that you can select (if the insurer offers it). It states that you will pay a percentage (usually between 10% and 20%) of the medical costs out of pocket, while the insurance covers the rest in exchange for a lower premium.

This is a smart option if your family is in good health, has a limited medical history, and has low chances of frequent hospital visits.

That said, you must also be aware that in the event of a major calamity where hospitalization costs can be high, these out-of-pocket expenses can be substantial. Choose this option only if you have the financial flexibility to handle moderate medical bills without putting a strain on your finances.

6. Avoid Add-Ons You Don't Need

Many policies now offer health insurance with wellness rewards, but not all of them translate to real savings. Riders such as maternity coverage, OPD benefits, room rent upgrades, and alternative therapy coverage may sound useful, but they come at a cost. Unless there's a clear, immediate need, avoid them.

Keep your policy lean. Add-ons should support a specific and current medical need. Otherwise, they only inflate costs without offering real value. The best low-cost health insurance for families is one that covers all of your family's actual health needs, without any unnecessary extras.  

7. Leverage No-Claim Bonus (NCB)

Another effective "how to save on family health insurance premiums" strategy is to take full advantage of the No-Claim Bonus (NCB) that insurers offer. For the uninitiated, the NCB is a bonus increase (usually between 10 to 50%) to a policyholder's sum insured for every year they don't file a claim. 

In essence, you can effectively double your sum insured in as little as 3 -5 years. If you start your insurance policy early on, when your risk is at a minimum, and continue to take advantage of the NCB, you will enjoy a significant long-term cost-saving advantage.

That said, be sure to check that the no-claim bonus in your family plan is cumulative and not just a one-time discount. 

8. Compare Policies Before You Buy Or Renew

One of the most overlooked tips for lowering health insurance premiums is simply renewing the same policy year after year. Always take time to compare what other options are available on the market. If your policy is portable, you can switch providers without losing any accrued benefits, like no-claim bonuses or your waiting period.

Several tools are available on the market to compare various aspects of policies, including annual premiums, network hospital coverage, waiting periods, policy exclusions, and claim settlement ratios, among others. Working with a licensed insurance advisor will provide you with even more clarity on finding the best policy to meet your current medical needs. 

Comparing policies also gives you the ability to employ another smart tactic: choosing network hospitals to reduce costs. Certain networked hospitals have even lower rates and cashless treatment options, which will further reduce any out-of-pocket costs for you.

9.   Use Tax Benefits to Offset Costs

Until now, all the tips have focused on maximizing the benefits of your policies while minimizing the upfront premium cost. There is, however, another way to reduce your out-of-pocket costs while insuring your family, and that's by taking advantage of the tax benefits on family health insurance.

Under Section 80D of the Income Tax Act (If you opt for the old tax regime), you can claim deductions of up to ₹25,000 each year for health insurance premiums paid for yourself, your spouse, and children. If you're also paying for your parents' insurance, you can claim an additional ₹25,000 or ₹50,000 if they're senior citizens.

Conclusion

The answer to the question, "How to save on family health insurance premiums?" is simple: make smarter choices. Opt for a family floater plan, supplement it with a super top-up, cut down on unnecessary add-ons, take advantage of the NCB, and always make it a point to reassess your policy every 12 to 18 months.

The simple formula ensures your family is fully insured without harming your bank balance. 

Seek Expert Insurance Advice With AssetPlus.

Sometimes, it's best to enlist the experts for something as important as your family's security. With AssetPlus, you will get honest and well-curated family health insurance options that best meet your insurance needs while putting your savings first.

Sign up today and learn how you can save on your family's health insurance with our experts!