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Lose Weight Or Pay More for Insurance Premium

October 20th, 2010 · 5 Comments ·
 
 

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The next time you want to find a reason of motivation to work out at gym, think about the 20 percent discount on your life insurance premium.

Yes, one insurance company in US has just started offering that.

With nearly one-third of adult Americans, are considered obese, this offer is probably going to gain attention. One of them, Phoenix Cos. Inc, has already started offering a special package – customers are given reduced rates if their body mass index (BMI) remains in the 19 to 25 range. Customers will see their premiums drop by 5 percent for every five years that they keep a healthy BMI ratio, up to a maximum of 20 percent after 20 years.

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BMI is determined by a height to weight ratio. Normally, A BMI of between 25 and 30 is categorized as overweight and over 30 is considered obese.

Insurance is one of the things we buy, but we never want to use it, given a choice. It is a protection. The company deserves a tap on the shoulder because this program encourages its customer to maintain healthy weight with monetary reward. Obesity has caused diabetes, heart disease and other health-related complications that shorten life spans. In order to stay within the BMI, customers will have to lead a healthy lifestyle – controlled diet and regular exercise.

However, BMI does not take body fat percentage into consideration. Some sportsmen, like American football player and professional body builder, have higher BMI due to more muscle mass, yet are still healthy. Therefore, BMI and body fat should be both used if the insurance companies want to ensure fairer discount to customers.

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Will insurance companies lose their revenue by offering discount like this? Not really. When the customers live longer, they make more money from healthy customers who pay monthly premiums well into their 70s. So, I believe that more other insurance companies will follow suit.

How about people who complain that this discount is a discrimination based on health status? They believe that overweight is a biological issue beyond their control. While the word of “discrimination” is sensitive, I do not really agree overweight is something we cannot do about.

In fact, not only insurance company, airlines are doing the same too by charging more on overweight passengers. Click here to read if you want to know more.

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5 responses so far ↓
  • Lai Wee Kiat // Oct 20, 2010 at 6:20 PM

    Lol. This is a good one. Just fyi, my BMI is 26, so, that’s sad, because I can’t get the discount, eventhough I’m fit.

  • mydailywalk1 // Oct 20, 2010 at 9:19 PM

    I think it’s a brilliant thing this insurance companies are doing. This way if you are really dedicated to being healthy, you are rewarded with lower premiums a.k.a more money in your pocket.
    Well done to this insurance company.

  • u.v. // Oct 23, 2010 at 7:59 PM

    no here is a motivation!
    lose weight and save money
    worth spending money on a gym!!!
    people need to understand- in order to live a healthy life for themselfs and for their loved one’s they need to start a change in their life!
    great article! :)

  • Trijicon // Nov 5, 2010 at 12:03 AM

    This makes perfect sense… if you are higher risk, you pay more.

    I guess insurance companies are completely evil… still probably a little evil though…

  • Mdrozdziel // Nov 16, 2010 at 5:14 PM

    Can you provide a link to the company or some other source about this information?

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