Are you planning to purchase a good health insurance plan for your family but have little information on where to begin and how to about this entire thing? This post is aimed at enabling you to identify the right health insurance policy. Given the sheer number of policies available in the market and thousands of varying articles available on this topic, it is easy to get confused and feel lost. To avoid any such confusion we are going to adopt a very simple, easy to understand approach for answering all your queries on this topic.
Most important point: Many people keep on postponing their decision of purchasing a health insurance plan in search of a dream plan. Let me tell you, you are never going to find any such dream plan because it does not exist in reality. There is always going to be a trade off between one benefit and the other. Hence, as an aware buyer the best we can do is build a good understanding of what are requirements are and which plan caters to our needs in the best possible way. Once you have identified the right plan for you, do not waste any further time. The earlier you decide to purchase your health insurance cover, the better it is.
Q 1. Whether to go for an individual health insurance or family plan?
There is no fixed rule as to whether once should select an individual health insurance plan or a family floater plan. It totally depends on the composition of your family and the heath status and age of all the individuals. If you are a nuclear family comprising of young adults and small children with no history of chronic ailments, you can go ahead with a family floater plan but if you stay in a joint family and have parents above the age of 50 it is generally advisable that you buy two separate policies - one for your parents and the other one for your spouse, children and yourself. Generally, one shouldn’t include a “high risk member" i.e. a member with known major health issues, in a family floater policy, as he/she is likely to file frequent claims, year-after-year, leaving other members without any cover.
Q 2. Key Terms and Conditions of health insurance policies that we should know as buyers.
Following are a few important things that you should check before purchasing a health insurance policy:
Most important point: Many people keep on postponing their decision of purchasing a health insurance plan in search of a dream plan. Let me tell you, you are never going to find any such dream plan because it does not exist in reality. There is always going to be a trade off between one benefit and the other. Hence, as an aware buyer the best we can do is build a good understanding of what are requirements are and which plan caters to our needs in the best possible way. Once you have identified the right plan for you, do not waste any further time. The earlier you decide to purchase your health insurance cover, the better it is.
Q 1. Whether to go for an individual health insurance or family plan?
There is no fixed rule as to whether once should select an individual health insurance plan or a family floater plan. It totally depends on the composition of your family and the heath status and age of all the individuals. If you are a nuclear family comprising of young adults and small children with no history of chronic ailments, you can go ahead with a family floater plan but if you stay in a joint family and have parents above the age of 50 it is generally advisable that you buy two separate policies - one for your parents and the other one for your spouse, children and yourself. Generally, one shouldn’t include a “high risk member" i.e. a member with known major health issues, in a family floater policy, as he/she is likely to file frequent claims, year-after-year, leaving other members without any cover.
Q 2. Key Terms and Conditions of health insurance policies that we should know as buyers.
Following are a few important things that you should check before purchasing a health insurance policy:
- Cover Amount - What might look like a sufficient cover amount today may not be sufficient for your requirements tomorrow given the speed at which the price of medical services is rising year-on-year. Hence, you must select your health insurance cover keeping in mid the ever increasing prices of everything.
- Room Rent Limit - This one single clause can have a major impact on the claims that you will be able to file against your health expenses. Generally, buyers tend to think that a Rs. 10 lacs insurance cover translated into the ability of being able to claim up to Rs. 10 lacs against your medical expenses in a single year. While this is true, the amount of expenses you can claim at any single instance is going to be in proportion to you room rent limit. As a simple example if your room rent limit is Rs. 6,000/- and you opt for a room that is priced at Rs. 10,000/- you are essentially eligible to claim only 60% (Rs. 6000/- is 60 percent of Rs. 10,000/-) of your overall medical expenses including the amount paid against surgery etc. Hence, you should generally try and opt for a no limit policy or a policy that allows you to opt private rooms with good room rent limit.
- Copay clause - This again is an important clause. A copay clause of 20 % essentially means that 20 percent of the overall medical expenses will be borne by the buyer and the rest 80% will be borne by the insurance company. There is nothing good or bad about this clause. As would be easy to infer, an insurance plan with copay clause is going to have a lesser premium than an insurance plan without copay clause, keeping all other elements same. So it is your decision as an individual what suits your need and preferences. However, if the premium is not substantially different, we would advise you to opt for a policy without any copay.
- Cover for pre-existing diseases - Pre-existing diseases include various health conditions including the ones diagnosed by a doctor, any major hospitalization in the past and the ailments for which one is taking medication. Such ailments are covered after certain time duration. Different policies have different clauses when it comes to the coverage of pre-existing diseases. You would seldom come across policies that cover pre-existing diseases from the very start. Most insurance companies provide coverage for existing diseases only after 3 to 4 years your having purchased the policy. The lower the waiting periods, the better.
- Restore benefits - Some plans reinstate your coverage in case you exhaust your cover in a policy year. It is a nice to have feature especially for those buyers who are opting for a family floater policy. You must take this into consideration while deciding which health insurance plan to opt for.
