Why might insurance companies impose lifetime limits on benefits?

Insurance companies often impose lifetime limits on benefits primarily to manage and control costs associated with high-cost claimants. By setting a maximum on the total amount that can be claimed over a policyholder's lifetime, insurers can mitigate the financial risk associated with covering individuals who may require extensive and expensive medical treatments over time. This practice helps to stabilize the insurer's financial exposure and maintain premium affordability for all policyholders.

While wellness promotion, preventive care, and ensuring coverage for all applicants are important aspects of health insurance, they do not directly relate to the rationale behind implementing lifetime limits. In contrast, the focus on managing claims expenses is a fundamental reason for this practice, allowing insurers to operate within sustainable financial parameters.