Why is Health Insurance Important?

A health emergency will not knock on your door before entering your life. Especially with physical fitness featuring low on our priority list, diseases are becoming more common. Medical treatments especially in private hospitals can lead to inflated bills. And if you find yourself in such a situation, it can completely drain your savings if you don’t plan ahead. A health insurance plan will offer you a cushion in times of medical emergencies. It provides you and your family with financial assistance that will cover you and your family’s urgent medical needs. Apart from this, buying a health insurance policy can also offer you tax benefits under Section 80D of the Income Tax Act. 1961.

Different Types of Health Insurance Plans in India

The several types of offline and online health insurance plans in India are:

• Individual Health Insurance Plans
• Family Health Insurance Plans
• Senior Citizen Health Insurance Plans
• Personal Accident Insurance Cover
• Group Health Insurance Plan
• Maternity Health Insurance Plan

Two types of health insurance policies that have been introduced recently are

• Coronavirus Health Insurance Plans
• Unit Linked Health Insurances

Individual Health Insurance Plans

Individual health insurance plans offer financial cover against medical expenses for an individual. The insured alone gets all the benefits of the plan. It is best for individuals whose family members are already insured or who is at a higher health risk. An Individual health insurance is for a single person and cannot float within the family. This type of medical insurance plan covers hospitalisations, surgeries, room rent, physician’s fee and tests. However, the insured has to pay a certain amount as co-payment for some healthcare services. There are no restrictions on the maximum age for the renewal of the policy.

Family Health Insurance Plans

A Family Health Insurance Plan or a Family Floater health Insurance plan is a single sum of money offered to the entire family as coverage. The sum is divided amongst the family members equally in case multiple members fall sick. A single premium is to be paid in a year to avail this insurance. A single claim or multiple claims can be made within a year under this plan. It is more cost-effective than taking individual health insurance plans for each member of the family. However, addition of senior citizen members into this plan may increase the yearly premium.

Key Benefits of Health Insurance Policy in India

When the medical bills pile up, your savings drain quickly out of your pocket. A regular health check-up may also cost you more than you can afford. This doesn’t mean that you cannot have access to the best treatments available for you and your family. A health insurance policy comes to your aid is such a scenario. It covers your medical expenses so that you can lead a long and healthy life. Here are some key benefits of an online health insurance:

1. Medical Check-Up Facility

You should get a full health check-up once a year to nip any oncoming diseases in a month. Most of us ignore this fact because we don’t have the resources. A health insurance plan offers you the facility of regular health check-ups. These check-ups can be inclusive or you can have it as an add-on with your medical insurance plan.

2. Ambulance Fee

The transportation fee for the patient from their home to the hospital can be costly. Most health insurance plans offer coverage of the ambulance fee up to a certain amount. This way, the patient and the family can only focus on the treatment and forget about the frill charges.

3. Coverage of Pre and Post-Hospitalization Expenses

If the insurance covers the disease or illness, they will provide the pre and post-hospitalization expenses. This means that if there are any medical bills that arise prior to hospitalization, they will be covered. If you need medical care at home after your stay at the hospital, the health insurance will cover that too.

4. Cashless Medical Treatment

If you get treatment from one of the network hospitals of the insurance company you can avail the Cashless Claim facility. This facility allows you do get treatment without paying for it. The network hospital and the insurance company will settle your bills amongst themselves. The list of network hospitals is available on the website of company.

5. Tax Benefits of Health Insurance Plans

Health insurance plans offer you tax benefits under the Section 80D of the Income Tax Act. You get a tax rebate, the amount depending upon the premium and certain factors. If you are below 60 years, you can get a rebate of up to Rs.25000 in a year. If over 60 years, this amount can go up to Rs. 50000. If you are paying insurance premium for your parents, you get rebate up to Rs. 55000.
*tax benefits are subject to changes in tax laws

6. Third Party Administrators

Third Party Administrators or TPAs assist both the insurer and the insured. They help the insurers against fake claims or overhead costs. TPAs help the insured to avail secure and swift services. These TPAs handle claims, reimbursements, premium collection, etc. on behalf of the insurance company.

7. Pre-Existing Disease Cover

After an incubation period (generally 2-4 years) insurance plans begin to cover pre-existing diseases. Pre-existing diseases are illnesses that the policyholder had before buying the policy. These may include diabetes, hypertension, etc. You can claim for these illnesses once the incubation period is over. But these diseases should be mentioned in the policy.

8. Room Rent Sub-limits in Your Health Insurance Plan

Most insurance policies reduce their liability by putting sub-limits on certain services. One of which is room rent sub limit. The health insurance policy will offer you a maximum coverage up to the sum assured, but they may limit their expenses. For example, there may be a cap of Rs 6000 on room rent, or they may not offer to cover a suite. If your hospital room charges are 10,000, the insurance will give you 6000 and the rest 4000 will be borne by you. The charges mostly depend upon the type of room you require, for example, a private room, semi-private room, suite, etc.

Does a Health Insurance Policy Cover Coronavirus (COVID-19)?

If you have an existing health insurance policy, a coronavirus claim will be handled by the insurance company expeditiously. It will go through a thorough review by the claim review committee and decided if it will be accepted. If you want to buy a health insurance policy online, most of them now offer insurance against coronavirus. Certain insurance companies have also rolled out medical policies centred around COVID-19. The IRDAI has also launched two new policies for Coronavirus – Corona Kavach Policy and Corona Rakshak Policy.

Health Insurance Plan Inclusions & Exclusions

Most insurance policies are customizable and you can choose which one suits your requirements. However, there are certain common inclusions and exclusions which you can choose from. They are:

Inclusions

• Hospitalization expenses
• In case of organ transplant, donor expenses up to a certain amount
• Overnight hospitalizations in cases of serious injuries
• Pre-existing diseases after a set incubation period
• Pre and post hospitalization expenses
• Ambulances charges up to a certain amount
• Room rent up to a sub limit
• Free health check-ups
• Maternity and new-born expenses
• Day care treatments
• Treatment from home or domiciliary hospitalization

Exclusions

• No expenses incurred during the waiting period (30 days), unless it is an accidental emergency
• Pre-existing diseases are not covered in the incubation period. (Usually 2-4 years)
• Illness and injuries caused by war or nuclear activities
• Suicide attempt
• Cosmetic/Obesity/Aesthetic surgeries
• Replacement of hormones or sex-change operations
• Dental or Eye Surgeries
• Non-allopathic treatment
• Certain treatments or diagnostic tests
• Treatment abroad by under-qualified professionals

It is best to compare health insurance plans online to choose the one which offers maximum coverage.