When you shop at the local supermarket, it is only normal that you would choose the best products for your family. You take a close look at the manufacturing details of a ketchup bottle, the date of packaging, expiry and the like. What if there are 10 different brands of tomato ketchup lined up on the shelves? Wouldn’t that puzzle you as to which one to pick? Wouldn’t you also read the fine print and ensure that the product you are buying for your family is the best?
If a ketchup bottle needs so much attention, then why aren’t we more careful with our health insurance? Shouldn’t we scrutinise what we are buying to see if the product suits our purpose. Unfortunately, in most cases, we do not. We don’t spend much time in choosing the health coverage that we need. We may buy health insurance at the insistence of our employer because it is a good way to save on tax. Oddly enough, many of us think that investing in a health insurance plan is a waste of money since it doesn’t give us returns. It’s time we changed this attitude and looked at health insurance as a necessity.
Here’s what we can do.
Family floater vs individual plan
If you wish to insure yourself, opt for the individual health plan. If you intend to get the entire family covered, go for the floater plans. These are an extension of the individual plans. Individual plans are for everybody. They can also work out to be even cheaper if you buy them for your children separately. In contrast, the biggest benefit of a floater plan is that they give a higher cover for a lower price. It is ideal if the family is young and there are fewer chances of medical emergencies. All insurance companies offer these two policies to customers.
While choosing between the two, you should not consider only the premium. If you go shopping for the right cover, you will realise that the price differential has significantly reduced today.
Assessing the family’s needs
To choose the right health insurance policy, you have to first assess your family’s needs. How much coverage do you think will suffice if there is a medical emergency at home? If you have a young family, a cover of ₹ 5 lakh can be enough. If the family has older members, you will do well to have separate individual cover for them. For example, if your parents are old, it makes more sense to buy separate senior citizen covers for them. So, the choice of plan will depend on the number of family members, their age, family income and the like.
How much cover do you need?
This depends on where you live. For example, if you live in a metro, hospitalisation can cost you much more than what it will if you stay in a tier 2 or 3 town/city. For metros, a cover of ₹ 10 lakh can be adequate for a family and ₹ 5 lakh for a non-metro. But, the way hospitalisation costs are shooting up, it is advisable to go for a top-up plan for better cover.
Understanding top-up plans
Many of us have health insurance from our employers. This makes us happy, as we feel we are adequately covered. But these group covers have certain exclusions, which can be bothersome. For example, these policies do not cover certain critical ailments. There may be restrictions on room rent. There can also be co-pay clauses in which the policyholder has to bear a part of the cost during hospitalization. To save yourself from these hassles, it is good to go for an extra cover that complements the employer’s group insurance plan.
This is where top-up plans come in. They enhance the health insurance cover offered by employers and work independent of the base plan. They also work out to be cheaper than family floaters.
Health insurance is a necessity. It is not an investment for returns. A health plan for the family should ideally cover up to ₹ 8–10 lakh. Before zeroing in on a plan, analyze the types of health insurance plans available in the market. Keep an eye on the exclusions and sub-clauses and make sure you have the maximum cover in case an emergency crops up.