The soccer game is on, in full swing. The score is 1–0. The home team scored in the first few minutes of the game. Ever since, the visiting team has gone into attack mode. They’ve had many near-goals too. But the home team’s goalkeeper has been strong and steady. He has protected his team’s one-goal advantage.
The goalkeeper’s role is a crucial one. As long as the football is near the centre of the field, the goalkeeper has no role to play. But when the ball nears the goal, it falls to him to save the day. Health insurance is a bit like that. As long as you are healthy, it does nothing and you just keep paying the premiums. But as soon as you fall ill and need hospitalisation, the health insurance kicks in. It helps you pay for the medical treatment you need.
What is health insurance and how does it work?
Here, the policyholder pays a premium for the health insurance coverage. The coverage takes care of the policyholders’ medical and surgical expenses over the specific period. In India, health insurance mostly comes into play during hospitalisation. But, a good health plan also includes preventive health checkups.
Types of health insurance
Different types of health insurance are available. Here’s a quick look at them:
Individual health insurance:
This plan caters to a single person, i.e. the policyholder. Suppose you buy an insurance policy worth ₹ 5 lakh, you are covered for that amount during the policy period.
Family floater plans:
Think of it as a wide umbrella that shields your family’s finances. The cover amount is shared by every family member.
Senior citizen health insurance:
Senior citizens tend to reminisce the ‘good old days’. Give them one less topic to talk about. Get them insurance for continued access to great medical treatment, whatever their age may be.
Critical illness plans:
These cover specific severe illnesses that do not occur very frequently. But, medical costs related to these illnesses will be high. The insurance pays a fixed lump-sum benefit if you are diagnosed with any of those illnesses.
Group health insurance plans:
These plans offer coverage to a group of people, such as members of a society, employees of a company, or a group of professionals. Employers provide these as a key employee benefit. Such plans may also provide coverage to the employees’ family members.
Unit-linked health plans:
Unit-linked health plans combine health insurance with investment. The investment earns returns at the end of the insurance term. Of course, the returns are dependent on market conditions.
Maternity health insurance:
This is a ‘family planning’ of a different type! Plan ahead with this insurance and you can have ‘family blessing’ of a different type as well: a stress-free pregnancy and delivery. This plan takes care of all your pre and post natal expenses.
How health insurance differs from other types of insurance
Think of health insurance and life insurance like salt and sugar. They may look similar, but you don’t want to mix them up! Similarly, these two insurance types serve very different purposes. Health insurance covers you against the risks of hospitalisation and medical expenses. Life insurance covers you against the risk of death. So, your nominee receives the payment.
Benefits of health insurance
- Cashless hospitalisation: No more running around for cash during an emergency. You can simply go to a hospital listed in the network of the insurance company and seek cashless hospitalisation.
- Cash allowance:
If your hospital stay exceeds a certain number of days, you receive a lump sum to spend as you like. You don’t need to provide the insurance company with any proof of usage. You can spend it on taxi fare, food, and the like.
- Extra benefits:
These would include preventive health checkups, consultations with doctors, and the like. So, extra medical costs, such as doctor’s consultation fees, are mitigated. Free health checkups are usually scheduled once every four years. You can request for the free health check-up on call or in person. You can call the insurer’s toll-free number or visit its branch office. The insurance company will then schedule the free health check-up.
- Alternative therapies:
Alternative therapies like homeopathy, Ayurveda, and yoga have gained immense popularity. This has prompted many insurance companies to include these within their coverage. The only caveat is that the treatment should take place at a government hospital or an institute recognised by the Quality Council of India and National Accreditation Board for Hospitals and Healthcare Providers.
- Dental treatment:
Some insurance companies offer dental treatment coverage, but only after a certain waiting period.
- You save money, and enjoy tax benefits:
Your virtual and physical wallets will thank you at the time of medical emergencies. Plus, you even get tax benefits. These benefits are available under Section 80D of the Income Tax Act. The tax benefits are applicable on the premiums paid. You can even earn tax benefits on the premiums you pay for your parents! So, your accountant will thank you as well! Most importantly, your family will be thankful for your forward planning.
The quality of your health is only partly in your hands. We can eat the best food and take as many precautions as possible. But, we can still fall sick. We do not live in sheltered bubbles where we can withstand exposure to all illnesses. Rather, what is within our control is how much we spend on our health. Don’t let sickness and the resulting costs win. Protect your financial, life, and health goals with a good health insurance plan.