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Health insurance offered by different companies may vary slightly at certain levels but first it is important to make the choice as to what kind fits your requirements.
When we decide to buy a private health insurance the first few issues we have to confront are, “for whom do we need health insurance”, “how much health insurance will be enough” and “about how much can I afford to spend on it.” Instead of answering these questions first and then look for insurance you can even take the way round. Know what is available, see what they offer and then take decision. There are numerous options at hand to choose from.
The first choice to be made is between health insurance policy for family or separate health plan for everyone.
Family Floater Health Insurance
In a Family Floater, you decide for a sum assured for the family. That sum is available to all insured under the floater policy. It can be used by either or all the members insured up to the given sum insured. Premium depends upon the number of family members insured. A family floater can be taken for self and spouse, self, spouse and kids, self and kids and spouse and kids. Most companies don’t allow parents to be included.
Advantages
• Reduced premium than in case of individual plans for everyone
• Availability for adequate sum assured
• Ideal for low risk young families
• All members covered in a single policy
• Being a single policy it is easier to manage
Drawbacks
• Reduced cover available to other members in case of a claim
• Might not provide sufficient cover in case of multiple claims in a year
• Children can be covered in a floater policy only up to the a certain age, generally 18-25 years depending upon the company
• Anyone reaching the maximum renew up to age is excluded from the family floater and separate policies may have to be bought.
Individual Health Insurance
Individual health insuranceis, as the name suggests, taken for single individual. It can be bought for each family member separately. The sum insured in this case is available for the single person insured. Premium depends upon the age of the individual and sum insured. Each policy needs to be managed as a separate policy.
Advantages
• It can be taken for every member of the family including for the parents
• It is ideal for high health risk families or the ones in higher age bracket where individual cover needs to be substantial
• The policy doesn’t lapse with one member reaching the maximum renewable age
Drawbacks
• It is a little costlier than a family floater policy.
• Each policy needs to be maintained separately..
• Coverage may be lower than offered by a floater in case of a single claim in a year
Besides these two basic types, there are specialised health insurance policies. These can be availed as riders to the main health policy or can be taken as individual policies. They are taken to cover a limited risk rather than general health.
1. Critical Illness Policy
A critical illness policy or rider covers specific illnesses like heart attack, paralysis, certain types of cancer, major organ transplants and similar other life changing illnesses. The cover is provided for the illnesses listed in the policy document only.
Characteristics
• It can be taken as a standalone policy or a rider
• It covers only specific illnesses as listed in the policy document
• Diagnosis of the illness entitles the insured for claim
• The claim amount is given to the insured in lump sum
• Insurance company might not honour the claim if the insured dies within 30 days of diagnosis
• Waiting period for the cover to come in force is 90 days
2. Personal Accident Cover
Personal accident insurance covers risk arising from accidents, be it at home, or outside. It is a tool to protect your family and yourself from the financial concerns such as loss of income and medical expenses due to accidents. It also covers the loss of income in case of temporary or permanent disablement. Accident may include plane crash, train accident, murder, hit-and-run etc. It is taken as a separate policy .
Characteristics
It can be taken as a standalone policy though accidental death or dismemberment cover can be a rider to life insurance as well.
• Personal Accidental policy covers accidental death and loss of limbs, permanent total and partial disablement
• It compensates for permanent or temporary loss of income due to accident
3. Hospital cash
Hospital cash policy offers a fixed amount of cash per day of hospitalisation for a fixed maximum number of days. Though it can be taken as a standalone policy, it works best as add on to a regular health or critical illness policy.
Characteristics
• The policy offers a fixed amount, per day of hospitalisation
• Maximum number of days for which money will be reimbursed is fixed
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