What should you know before buying a health insurance?

Health Insurance Application

While a lot of people are aware to the benefits of living a healthy lifestyle while being insured with a health insurance, a huge proportion of population still think health insurance is a method of saving tax.

A recent survey revealed that 75% of the young individuals between the age of 25 to 35 years subscribed to a health insurance plan. However, 46% of these policy owners purchased the policies to avail the tax deduction over the paid insurance premium. Such a purchasing pattern was even more prominent in women with about 64% of them going after tax rebate. This survey cleared that a majority of people are still unaware of the real benefits of a health insurance.

Anyhow, having an insurance even if their sole purpose was to get tax deductions is still better than having no insurance at all. Although the demand for health insurance has risen in India, we are still far behind with only 0.16% of the Indian population having health insurance as per IRDA.

A good number of people who want to purchase a health insurance plan find the terms quite complicated or are too busy to find time to go and buy the insurance. They are not aware that they can, in fact, learn about both group or individual health insurance plan and even buy health insurance online.

What makes Health insurance so important?

Another survey revealed that half of the candidates thought that health insurance is only for the old who have more health issues while 48% believe that they don’t need insurance as they’re fit. In fact, some even thought that they don’t require insurance as they have enough savings to take care of their medical bills in the present and post-retirement period.

The truth is health issues can trouble you without warning. And, in current times even younger individuals aren’t safe from the risk of lifestyle diseases. Also, medical emergencies, infections and accidents can come unannounced at any age. Often the medical expenses are so high that they can upset your budget greatly. However, if you have health insurance, your bills will be taken care of by the insurance company. And, of course, you do get that tax deduction though that shouldn’t be your chief motive to buy a health insurance.

How much cover should you get?

In most parts of India, a family floater health insurance cover of Rs 5 lakh is sufficient. However, in metros you might require a larger cover as the medical treatment costs are higher in these parts. Even a couple of days of hospitalization can lead to bills between 50K to 70K. This costing will leap even higher for major critical health conditions and surgeries.

No wonder a regular health insurance may not be enough in cases of serious illnesses. In such instances critical illness plans are better, though they come at a higher price and cover specific illness only. Hence, it’s always important to use a combination of both. You can use a health insurance premium calculator to calculate the premium you can easily afford and accordingly select the cover, or you can also take help of an expert.

Another factor to consider before buying insurance is the number of total family members and their age. If your family consists of two newly married couple you require a lesser cover, however if you have dependent parents (who are older in age) or children, you will need to increase the medical cover accordingly.

In case your medical needs are changed, or a new member is added to the family you can always increase the cover. Also, if you’ve exhausted the medical cover, you can also top-up the policy at a smaller top-up premium to replenish the cover.