Health insurance is like an annual health contract between an insurance company & you. As per this contract, the insurance company agrees to pay for your hospitalization expenses up to a certain limited amount annually. This amount is called a health insurance cover. This amount can range anywhere between 1 lakh to 1 Cr. For this cover amount, you pay an annual fee called premium that can range anywhere between 5000/- to 50,000/- per year.
Why Do You Need a Health Insurance Policy?
Below are 6 reasons why you need a health insurance policy:
1). 1 CR Cover Amount: You get up to Rs. 1 CR cover amount per year. You can consume this cover amount for any type of hospitalization as per your policy terms & conditions.
2). Pays 90% Hospital Bill: Health insurance generally takes care of 90% of your hospitalization expenses. You can either avail reimbursement or cashless services.
3). Accident Treatment Covered: Pays for any accident related hospitalization expenses from the 1st day of your policy as per your policy terms & conditions.
4). Seasonal Illness Covered: Pays for any hospital treatment related to diseases like covid, fever, malaria, dengue, pneumonia, malaria & others just after 1 month of purchasing the policy.
5). Severe Illnesses Covered: If you aren’t affected by any pre-existing disease before purchasing the health plan & if you unexpectedly get any serious illness, it is taken care of after 30 days. These diseases include heart, lung, liver, kidney, diabetes, blood pressure & many more.
6). General Surgery Covered: Pays for any general surgery after a waiting period of 2-3 years. These include piles, fissures, gallbladder, kidney stone & any surgeries listed in your health plan.
Types of Health Insurance Plans
1). Individual Health Insurance:
This is a health insurance plan where a person covers only himself by paying an annual premium. His family is not covered in this plan.
2). Family Health Insurance:
This is a plan where an individual along with his spouse & dependent children are covered against hospital expenses. Some plans also offer coverage to the extended family members.
4). Senior Citizen Health Insurance:
This plan is specially designed for senior citizens considering their medical needs. It’s a must have plan for those elders in your house who were never covered.
5). Group or Corporate insurance:
This is a health insurance policy provided to you by your employer that covers your immediate family & you without waiting period. Its downside is that once you leave the company, it becomes null.
Benefits of Health Insurance
1). Hospitalization expenses – Health insurance generally pays 80% of your hospitalization expenses.
2). Easy cashless claims – By simply showing your health ID card you can avail cashless treatment at any hospital.
3). Tax savings – You can save up to 25,000/- in taxes on your insurance premium. Some exceptional cases may allow up to 50,000/- if you’re above 60.
4). Critical illness cover – Lifestyle illnesses including critical illnesses like heart, lung, liver, kidney, diabetes, blood pressure & more are also covered.
5). Added protection – You can even purchase an additional add-on cover policy that can take care of your doctor’s visit expenses.
Tax Benefits of Health Insurance
On acquiring or recommencing a health insurance plan, the policyholder becomes qualified to get tax aids under section 80D of the Income Tax Act 1961. In order to get yearly tax paybacks, you should renew health policy on time.
How to Choose a Good Health Insurance Plan?
1). Large Cover – Select a large cover amount in the beginning, for e.g. a minimum of 5 to 10 Lakhs. In case it’s a family plan, go for an amount of 15 lakhs.
2). Waiting Period – Know about the waiting period. Once the waiting period is over, any critical illness or disease can be taken care of.
3). Don’t Delay – If you choose a small cover earlier & later get a serious illness, you will never get a large cover.
4). Customer Service – Choose a plan that has good claims customer service & cashless network hospitals.