A guide to choosing the right health insurance policy4 min read . Updated: 10 Sep 2020, 04:48 PM IST
A health insurance policy covers medical expenses based on the premium paid the policyholder, the coverage offered by the insurer, and the requirement.
Growing old is that unpleasant aspect of life that we seldom contemplate about unless we are met with sudden and exorbitant healthcare expenses. The skyrocketing costs of medical care facilities, coupled with the warped demand and supply game owing to the poor healthcare infrastructure in many parts of the country, have resuscitated the discussion on making health insurance policy an important component of one’s financial armory.
However, picking the right policy is as important as deciding to seek the health policy coverage. A health insurance policy covers medical expenses based on the premium paid the policyholder, the coverage offered by the insurer, and the requirement. Most health policies in India include nursing, treatment, and diagnosis expenses and may also offer add-on features for specific requirements.
Although understanding what kind of coverage or policy works best for you is critical, remember that the sooner you get yourself insured, the better it is. Here are the common health insurance plans.
1. Individual health plan
As the name suggests, an individual health plan is one whose benefits can only be reaped by an individual. You can purchase an individual policy in either your name or in the name of your spouse or child and the premium depends on the individual’s age, and the sum insured. This plan is better suited for early career professionals and people who are young and single who may not have persistent health issues. The premium costs are generally lower and they provide coverage for hospitalization, thus keeping you prepared for any medical exigency.
2. Family floater policy
This policy comes in handy when you are looking to secure the health risks of the entire family. Family floater policies are comprehensive schemes that provide coverage for people belonging to different age groups: kids, adults, and older people. Such plans bring all the members of the family under an umbrella cover and the biggest perk is that the policyholder can take care of his/her family and all the members through one plan than having to manage and pay premiums for 4-5 individual plans.
3. Top-up policy
A top-up plan is similar to a regular health insurance policy. It will cover the policyholder’s hospitalisation costs, but the difference is that these costs are reimbursed only after a specific threshold limit is reached. This threshold limit is known as a deductible, which is an amount paid by a policyholder towards medical expenses before the top-up health insurance policy is activated. Usually, top-up plans have a lower premium compared to regular insurance plans. You can opt for a top-up plan as an addition to your regular health insurance plan in case any major expenses arise.
4. Insurance for senior citizens
These are insurance plans specifically designed for senior citizens that take care of the healthcare requirements that come with old age. Individuals between the age of 60 and 75 years can opt for these plans. Some of the main benefits of senior citizen health insurance plans are cashless hospitalization cover, day-care expenses, and pre-existing and disease cover.
Critical illness plan: Critical illness insurance plans pay a lump sum on the diagnosis of any serious and long-term illnesses that require the patient to undergo expensive treatment procedures. Usually, most health insurance plans provide a critical illness rider cover on paying an extra premium. Alternatively, you can strengthen your coverage by opting for standalone critical insurance, as it could provide a more comprehensive coverage.
While choosing the best health insurance policy, a lot of factors have to be weighed upon.
Therefore, it becomes very important for you to carefully consider the following factors, before opting for the insured amount that you require:
Age: - Your age plays an important role in determining the extent of the coverage you require. Younger people can opt for lower coverage policies and gradually increase it over the years. Since the probability of health problems increases with age and the chances of a claim being made also rises, the premiums are costlier for older policyholders.
Health: - The current status of your health is a critical determinant while gauging the health insurance coverage you would need. A low coverage would suffice if you are healthy, but if you have an existing health condition which may require greater medical intervention in the future, it is better to opt for a higher coverage amount. If you know that your ailment will worsen with age, you choose a higher coverage a amount initially and increase it gradually to avoid being burdened by high premium payments all of a sudden.
Location: - The city in which you live weighs in on the costs of medical care facilities. Medical facilities in metropolitan cities such as Delhi and Mumbai are relatively more expensive than in tier 2/3 cities. People living in these cities are also more prone to health issues triggered by pollution and stress, which may add to medical expenses and warrant higher policy coverage.
Income: - It would be imprudent to opt for a health policy whose premium is high enough to cause a dent in your monthly budget. There is no point opting for a mediclaim policy that eats into your overall financial health when, in fact, the purpose of health insurance is to safeguard your health and finances during emergencies.