What factor determines whether premiums for critical illness cover may change?

The claims experience of the insurer is a significant factor that determines whether premiums for critical illness cover may change. When an insurer assesses its previous claims experience, it gains insights into the frequency and severity of claims related to critical illness. If the insurer experiences a higher volume of claims than anticipated, it may need to adjust premiums to ensure that the coverage remains financially viable. This adjustment reflects the underlying risk associated with providing the coverage and helps the insurer maintain its financial stability.

Although the age of the insured, economic conditions, and the insured's lifestyle choices can also influence premium calculations, they do not directly dictate changes in premiums as clearly as the claims experience. The claims experience is a retrospective factor; it reflects actual data based on past claims, enabling insurers to make informed decisions on adjusting future premiums. Thus, it serves as a critical indicator of the risk pool's overall health, prompting necessary adjustments in premiums due to changes in the nature of claims made under the policy.