Close

	Receiver's Name:		*
	Receiver's Email:		*
	Your Name:		*
	Your Email:
	Your Message:

How much health insurance do you need?

How do you know if you have enough Health Insurance? Is Rs 1 lakh coverage sufficient, or do you need to have at least Rs 3 lakhs? No one knows when one will fall ill or need to be hospitalized. But, when major illnesses happen, their treatment can cost a lot. If one uses up one's savings and cashflow to pay hospital bills, this can disrupt one's financial stability by compromising the ability to pay EMI on ongoing loans and other financial commitments. So, its essential to have at least some health insurance.

The best way to identify if you have sufficient health coverage is to base it on how much cover can you afford. If you can afford paying a higher health insurance premium, then that is the best amount of coverage for you. Your coverage should be such that in case you or your family members need to be hospitalized, then the family is not footing all these healthcare bills out of its own pocket. If you have health coverage, then depending upon the exclusions/conditions, the insurance company will cover the costs for you.

Watch the video

Get what you can afford

Health Insurance is a useful way of protecting oneself from the costs arising out of unexpected medical emergencies. Even if you can get a modest amount of health insurance because that is all that you can afford, get it. It can still help you offset the cost of hospital treatment.

Please keep in mind that as private citizens, we cannot rely on the government to offer welfare state benefits to all of us. As a result, our medical bills need to be paid out of our own pockets. And, in case you hadn't noticed, the healthcare costs for even basic treatments are going up.

Finally, don't forget that under section 80D of the tax code, you are entitled to at least Rs 15,000 per annum deduction towards your health insurance policy, and more if you get a policy for your parents. So, even if you get a more expensive policy you can get a tax benefit commensurate to your premium, within this annual tax deduction limit.

Representative Prices for Common Procedures in India

The following are prices for common medical procedures in India. If patients do not have medical insurance, these costs will have to paid out of their own pocket.

Should you buy an Individual Policy or a Family Floater Policy?

The answer depends upon what you can afford. If you can afford it, its probably better to get an individual policy because you will get more coverage. However, if you cannot afford individual policies for all family members, then it might be more efficient to get a family floater policy that covers up to 4 family members.

The following is a representative comparison of the premium for these policies for a family of 4 members, husband and wife each 30 years of age, and 2 children aged 4 years and 2 years respectively.

Whichever policy you choose, you will be eligible for the 80D tax deduction.

Understand what your health insurance will cover

Like most insurance policies, health insurance policies also come with many conditions. Understand what is covered and what is excluded, so you are under no illusion of what the insurance company will reimburse you for.

At a minimum almost all policies in India cover for hospitalization, pre and post-hospitalization and related expenditures. Some policies have recently started covering "out-patient" services that do not require hospitalization, such as dental treatment. Most policies will not cover maternity benefits (like childbirth and first-year vaccinations for a new born). However, recently some new policies have started offering these but at the payment of a higher premium.

Health policies are "indemnity" policies, i.e., they will compensate you for any costs that you will incur. Under no circumstances will you get reimbursed for more than what you are spending or for loss of income or work. If you want these other types of benefits, you might need to buy a Personal Accident or Life Insurance policy.

Suggested Course of Action

Please consult your financial advisor for specific advice. The following can be used as a guide.

Comments

Thanks for your comment

    

manda said : 04/05/2012	Coach Purses Outlet all over the world are very glad to choose Cheap Coach Handbags, they are of the professional and fashionable designs Coach Outlet Online and styles to make you charming and fascinating, more and more Coach Factory are very welcome to visit our good fame online store to have those great Coach Outlet bags, they are sure to never let you down, so that you should come to Coach Outlet Store Online get close to this brand, which would never let you down. Coach Outlet Online are made of the top quality material, which louis vuitton purses are very durable to use. With the fashionable and perfect Coach Outlet appearances, they are very worthy to have. Coach Outlet Online are sure to make you look much better. Welcome to Coach Handbags Outlet to choose Coach Bags and enjoy the fashion. Cheap Coach Purses is a fact that adding charming Coach Bags to your cart is a very correct idea, which would make you have a outstanding dressing all the time, Coach Outlet Canada is also very great to make yourself much more fashionable Coach Factory Outlet, so that you are sure to be the focus Coach Outlet Online, people who are very great to have the great dressing should never miss to own Coach Outlet, it is a brand full of charming designs to be very suitable to the whole of you. louis vuitton handbags from our online store sure to be the first choice without any doubt. Welcome to Coach Factory Outlet have a look, they are waiting for your selection.With good fame is the best place for you to have your favorite, there you can have the expected results. Coach Bags are very welcome all over the international market, their various classic designs, good quality, reasonable price, and so on.
Raju Rao  said : 20/01/2012	Rewritten - sorry there were errors in earlier comment .pl disregard .. Hi I find that the probability of becoming ill or contracting certain diseases is not factored in . Obviously this varies with age and other conditions like geography or place . I would agree a family policy is a better bet as probability that all persons in a family would get sick at the same time will be low . Insurance companies promote their products looking at worst case scenarios - we should look at probable ones .
Raju Rao  said : 20/01/2012	Hi I do not find that the probability of becoming ill or contracting certain diseases is factored in . Obviously this varies with age and other conditions liek geography . I would agree a family policy is a better bet as probability that all persons in a family would not get sick at the same time will be low . Insurance companies promote their promotes looking at worst case scenarios - we shoould look at probable ones .
Rajesh Diwan said : 13/04/2010	Murali, I beg to disagree. The article says get an individual plan if you can afford it. It does not say individual plans are better. Ask any insurance expert, including those with experience of how this has played out in western countries where health insurance has been more popular, and they will tell you that individual policies are better if you can afford it. Also, Murali you mention that the EMI is 6226. This is a onetime payment and there is no EMI. EMI is for loans.
AJAY JASRA said : 13/04/2010	I agree with Murli... FAmily floater is better bet. Adding more to it, we should have critical illness riders more for us (including spouses) with our normal endowment / term or ULIPs... That helps more with health policy.
Murali said : 13/04/2010	You have said individual policy is better than family policy. I totally disagree with you. Consider the case you have mentioned above. 4 policies with 1 lakh each have the premium of 5294. But 1 policy with 4 lakh coverage has 6,226 emi. Hence just by paying 1k extra every year, you get 4 lakh which can be used anyone in the family. Its not that every person in a family needs hospitalization every year with a limit of 1 lakh. The insurance money can be better used in family policy.