Health Insurance Policy: Why, Which & How?

The skyrocketing medical care cost has made health insurance policy a key financial product for every individual. It provides you coverage against unexpected medical expenses caused by any illness or accident. At present, even a small surgery or accident can result into a critical financial crisis. Country like India, where majority of population is in lower income group, such incidents proved to be nightmare for them.

According to a report, about 16% Indians of lower income group go below poverty line (BPL) due to expenses incurred in health care. “Most Indians compelled to borrow from lender or relatives to meet the high medical bills”, the report says.

But insurance products are bit complex, you to be educate yourself in order to picking right plan out of numerous available in the market. Never treat insurance products as tax saving instruments.

There are few things that need to be considered while you buy a health insurance policy for you and your family.

1. First you analyze your insurance needs; you can seek help of an insurance adviser or a financial planner.

2. Can perform thorough research over internet to choose best suited plan, sum assured, benefits offered and premium rate.

3. In order to choose plan, compare various plans and their offering such as coverage and exclusion parts of the policy.

4. Take policy that fulfill your needs, don’t over buy; it would lead to higher premium.

5. Don’t buy coverage you don’t require such as if you are unmarried or don’t need children, don’t take policy with maternity benefit. Policy with maternity coverage costs significantly high.

6.Your health shape is an important factor that determines your health insurance premium, so try to be healthy.

7. All most all insurers offer significant discount on premium for person doesn’t smoke. So quitting smoking will result into fewer premiums.

8. Buy separate policies for your parents / in-laws; as premium is determined on the senior most members of the insured. Two separate policies will be cheaper that one bought for whole family.

9. Buy health insurance plan in your early age as age is another main factor on which premium is calculated.
Choose insurer that has the maximum claim-settlement ration.

10. Here, through an illustration, I’m trying to make you understand about two best health insurance policies present in the market.

Premium rates are for 30 years old Male+Spouse+1 Children, Non-smoker/Non-tobacco, Policy Term- 1 Year, and Rs.4 lacs Sum Assured.

Key Features/Plans Religare-Care Apollo Munich-Easy Health Floater Standard
Premium Rs. 8,455/ annum Rs. 9,460 / annum
Waiting period for Pre-existing diseases 4 years 3 years
Maternity Benefits Not Covered Not Covered
Room-rent Capping
OPD Coverage Not Covered Not Covered
Pre-hospitalization 30 days 60 days
Post-hospitalization 60 days 90 days
Daily-cash Benefit Rs 500/day For shared accommodation Rs. 500 (Max. up to Rs. 3000)
Day-care procedure 170 days 144 days
Organ donor cover Rs. 50,000 Covered
Emergency Ambulance Rs. 1,500 Rs. 2,000
Free health check-up Annual Rs. 4,000 after 4 claim-free years
No-claim benefits Increment of SA by Rs. 2 lacs Increment of SA by Rs. 4 lacs
Claim Settlement Ratio of The Insurer 65.59% 79.92%

*Note: Above data is for illustration purpose only. The actual premiums and benefits may vary.

In above illustration, you can clearly see that key features and benefits offered by Apollo Munich are richer than plan of Religare Health Insurance Company offers. But there is difference of Rs. 1,000 in premium rate. But considering the wide range of coverage offered by Apollo’s Easy Health Floater Standard, this excess of premium is worth paying. The only concern with Apollo Munich is its miserable claim settlement ratio.

 

Harjot Singh Narula

Harjot Narula is founder and CEO of ComparePolicy.com, an IRDAI approved insurance web aggregator focussed on selling online insurance for companies. Harjot has more than a decade of experience in software development and has also spent 5 years in US working for the mortgage and risk management industry.

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