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With different types of health insurance plans, which medical insurance policy do you think suits your family's needs? Read on to know about various health insurance policies and their features.
Medical expenses associated with medical emergencies, dreaded illnesses, and health care of the elderly can burn a hole in our pocket. A health insurance plan protects our wealth by paying for medical expenses.
Nowadays, different types of medical insurance plans are being introduced by the health insurance companies in India. In such a situation, to be sure that you are purchasing the best health insurance policy, you have to be aware of what each plan offers.
For a better understanding of healthcare insurance, let us take a look at the most popular medical insurance plans available in our country.
All the different medical insurance plans for individuals and the best family medical insurance plans can be grouped under either of the following two categories:
These are traditional health insurance policies that cover medical expenses. Under indemnity-based plans, the medical expenses are reimbursed to the policyholder on submission of necessary bills/documents. If the policyholder has opted for cashless insurance, he only needs to pay a certain sum, and the rest is paid by the insurance company. However, the amount claimed should fall within the limits of the sum insured.
Here are some popular indemnity-based plans:
Mediclaim: It is common belief that a mediclaim insurance policy is the same as a health insurance policy. However, since this plan only covers hospitalisation expenses, the policyholder has to be hospitalised to make a claim. Other expenses have to be borne by the policyholder out of his pocket. Also, pre- and post-hospitalisation expenses are not always covered by such policies. The premium payable depends on the value of the sum assured. This policy can be purchased either for an individual or for a family. If you are wondering about health insurance with maternity cover, health insurance for pregnancy comes as an additional rider in most policies.
Individual health insurance: Only the insured individual is covered under the policy. Most individual health insurance plans offer coverage of pre- and post-hospitalisation expenses. Individual health insurance can be purchased for every member of a family. But, only the sum assured for each individual can be claimed. However, claims for multiple individuals can be made at the same time (for instance, in the case of an accident when more than one individual of the family is hospitalised).
Family health insurance: Also called family floater policy, this plan covers the entire family (individual, spouse and children). However, some health insurance plans for family also cover dependents such as parents, siblings and parents-in-law. A single annual premium is paid for this type of health plan. Often, the premium payable for a family floater plan is less than what is charged for individual health insurance. Under this health insurance policy for family, the total sum assured covers every member of the family.
"Family floater is a pool account. There are two ways to take a family floater - one is with zero deductible and the other one is with 'X' deductible - where 'X' can be as high as Rs 3,00,000 or Rs 5,00,000. Today, treatment for ailments like cancer, or procedures like organ replacement can cost anywhere between a few lakhs and crores of rupees. That's when floaters come in handy. The sum insured is not divided equally in a typical floater policy. However, there are exceptions.
- A V Senthil, Finance Expert
Senior citizen health insurance: Want to buy health insurance plans for your parents who are aged? This plan is designed specifically to provide medical insurance for senior citizens. Generally, they can buy health insurance between the ages of 60 and 80. While most policies have lifelong renewal options, a few restrict renewal to 90 years. The plan also includes cashless facility during hospitalisation, provides coverage for critical illness, pre-existing diseases and specific diseases mentioned in the policy. Pre- and post-hospitalisation expenses for a specific number of days and annual check-ups are also covered under this plan. Usually, the sum assured in a senior citizen health insurance plan is higher than other plans. While some insurance providers don't ask for any medical tests at the time of purchase of the policy, others do. However, premium payable for senior citizen health insurance plans tend to be higher. This plan can be bought by children for their aged parents. Domiciliary treatment options are one of the main advantages of a senior citizen health insurance plan.
Unit Linked Insurance Plan (ULIP): This is a combination of insurance and investment. A portion of the premium paid is invested in stocks, bonds or mutual funds. The remaining portion is utilised for providing health insurance coverage. Since a part of ULIP is invested, after the lapse of a certain period, partial withdrawal from the fund is allowed. In ULIP plans, the fund value is returned to the insured (or nominee) in case of death. However, there are certain restrictions on the claims made under this policy. Also, the investment risks are borne by the policyholder.
These type of medical insurance policies pay a lump sum to the policyholder to cover for expenses arising from a pre-determined illness. Fixed benefit insurance plans can be chosen as add-on riders to the existing health insurance plans to cover expenses that may not be covered under the policy. Fixed benefit insurance plans can include:
Critical illness cover: This plan is designed to cover specific critical illnesses. A critical illness cover helps lessen the burden of additional expenses usually incurred in treating life-threatening illness. Once diagnosed with the illness, the insurance company assesses the reports and issues a lump sum amount as compensation, even if the insured isn't hospitalised. A critical illness cover mitigates expenses incurred in treating conditions like cancer, stroke, kidney failure, heart attack (sometimes only the first), multiple sclerosis and paralysis. This plan also provides compensation for a loss in income owing to the illness. However, the policyholder needs to survive a minimum number of days to make the claim. Also, the coverage comes into effect usually after a period of three months.
Accident insurance policy: Unlike other health insurance plans, personal accident insurance covers the policyholder against outcome of accidents like death, disability and injuries. Disabilities include loss of limbs, sight, hearing, speech or any other permanent damage as a result of the accident. Some accident insurance policies also provide child education support and life support benefits. However, this plan cannot replace a regular health insurance plan.
Hospital cash insurance: Under this plan, the policyholder gets a daily cash allowance from the insurance company in the event of hospitalisation. The allowance amount can be chosen at the time of purchase of the policy. Hospital cash insurance allowance usually ranges between Rs 500 and Rs 3000. However, the allowance can increase (based on certain clauses in the policy) if the insured is admitted to the Intensive Care Unit. This plan can be purchased either as a stand-alone plan or as an add-on rider to the regular medical insurance plan. Sometimes, it is already an added feature of a regular plan. The money received can be used to take care of expenses that are otherwise not covered by the insurance plan.
Since your health insurance policy is critical in times of medical emergencies, it is imperative that you choose one that's best suited to both your and your family's needs. Compare features, clauses, conditions, inclusions and exclusions of a few plans before making a decision. Another factor that you can take into consideration is the company's health insurance claim settlement ratio, which will give you a fair idea of the claims settled. So, go ahead and choose wisely!
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