How do I choose a health insurance policy?

My monthly income is ₹80,000. I’m 32 years old, married, and have two children, a 2-year-old boy and a 6-year-old daughter. I’d want to get health insurance for my family. Please advise.

-Name withheld on request

Insurance premiums are charged basis the customer’s current age and existing medical conditions. Since the chances of contracting any lifestyle diseases like diabetes, hypertension, high cholesterol, etc., are less at an early age, purchasing a policy for your family early on will be the wisest thing to do. It will ensure lower insurance premiums and wide coverage that will help you avail of quality healthcare services.

Before purchasing a health plan, evaluate your city’s average medical hospitalization expenses. You also need to factor in your salary and the family’s medical history. Assuming you live in a metro with your spouse and two children and have no major medical history, then opt for a base family floater policy with a minimum sum insured amount of ₹15 Lakhs. The annual premium for this will range between ₹15,000 and ₹17,000. Insurers these days also offer an option to buy a policy in instalments in case you do not wish to make the payment in one go.

Consider factors like the network of hospitals, the claim settlement ratio of the insurer, and the availability of cashless facilities before deciding on an insurer. Opt for a base plan that offers features like the reinstatement of base sum insured, pre-&-post hospitalisation and modern treatments. It will be an advantage if the insurer offers add-ons like the double cover, change in room-rent limits, vaccination cover, consumable cover, childcare cover, and guaranteed cumulative bonus, as these covers can be useful depending on the medical requirements.

As an alternative, you can go for a base family floater policy and, instead of add-ons, you top up your base policy with a Super top-up plan. This will ensure all the benefits of an advance plan but at a combined lower cost.

(Query answered by Rakesh Jain, CEO of Reliance General Insurance. If you have any personal finance queries, write to mintmoney@livemint.com to get them answered by experts.)