What is Health Insurance and Types of Health Insurance | Health Insurance Need

Health Insurance is a toll to cover the risk of a person or family incurring medical expenses of hospitalization and the treatment.

Health insurance companies bear these expenses against the premium paid by the insured. There are different types of health insurance plans in India and insurance coverage may vary as per the type of plan.

What is the Need for Health Insurance?

Health Insurance is very essential as it secures you against a range of medical problems.  It gives you an assurance for:

• Financial security
• Peace of mind for emergency & unwanted Medical expenses.
• Health Insurance is the much-needed financial backup at times of medical emergencies.

Risk and uncertainties are part of life and never comes by telling in advance. I have seen people have sold everything that they had to save their life and health.

If you have a health insurance policy, then all the expenses incurred from illness or injury will be paid by insurance company on your behalf or can be reimbursed to you by health insurance company.

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Types of Health Insurance Policies

Retail Health Insurance Policy

A Health Policy can be categorized into:

• • Individual Policy: The sum insured of the policy is applied on a person and will cover an individual only.
  • Family Floater Policy: Total sum insured of policy is applied to any of the members insured under the policy and covers entire family under one plan.

 Corporate Health Insurance Policy

A corporate health insurance policy is the policy that is provided by the employer to their employees. Most of the diseases are covered from day one. Pre-existing disease, Maternity benefits and other congenital disease are generally not covered under retail plans. But all these are covered under corporates policy from day one.

Health Insurance Policy inclusions and different Plans

Health Insurance plans are key components of a health insurance policy. A Health Insurance Policy can be c combination of listed plans. Premium amount is decided by insurance companies according to inclusions and exclusions of these plans into your health policy. You should know about these plans and policy inclusion before buying an insurance policy.

Cashless Hospitalization Plan

Cashless Hospitalization plans are indemnity plans that pay cost of hospitalization and medical cost of the insured up to the sum insured of the policy.

This is the main framework of any health policy and have this included in all the health insurance products.

In addition to hospitalization benefits, specific policies or tailor-made policies may offer a number of additional benefits like:

• Maternity benefits
• Newborn coverage
• Daycare procedures
• Pre & post-hospitalization care etc.

Family Floater Health Insurance

This plan covers the entire family in one health policy. It works under assumption that not all family members of a family will suffer from illness in one time and total sum-insured can be utilized by one family member.

• If total sum-insured is not utilized then remaining amount in policy cane be utilized by other family members if any medical emergency.
• A family floater health insurance plan gives complete cover to your family. Health Insurance company pays medical bills of the expenses incurred for hospitalization and treatment.

Pre-existing disease cover plan

These plans offer cover against pre-existing diseases. After a waiting period of 2-4 years, it gives all cover to the insured.

• Generally, retail policies do not give pre-existing cover
• The waiting period is defined for the treatment and coverage of different illnesses like:

1. 1. Nose and Throat diseases covered after 1 year
   2. Stones are covered after a period of 2 years
   3. Joint replacements after 4 years.

Senior Citizen Health Insurance

These plans are for older people in the family. A medical health check is done by an insurance company prior to offering a health insurance policy to senior citizens.

However, there are insurance companies offering health insurance policies without pre-policy health checks.

Maternity Health Insurance

These plans give maternity benefits and other related coverage. It takes care of both pre and post-natal care and baby delivery.

• A limit is defined for Maternity coverage in most health insurance policies.
• If maternity bill is more than the defined limit then the differential amount is to be paid by the insured.

Hospital daily cash benefits plan

Daily cash benefit is a defined benefit in the policy that pays a defined sum of amount for every day hospitalization.

Critical illness Plan

A lump-sum fixed amount is paid on the diagnosis of covered critical illnesses and medical procedures like heart attack, cancer, stroke, etc. This plan should always be there if you are in forties or your parents are included in Family Floater Plan.

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Pro-active Plans

The aim of these plans is to help customers to understand and manage their health better.

• These plans are designed to provide assistance based on medical, behavioral & lifestyle diseases associated with chronic conditions.
• Health Insurance companies promote preventive health checks for their customers.
• This helps in reducing the claim ratio of the company by getting detected the disease before it is complicated.

Disease-specific special plans

These plans are designed keeping in mind the growing incidence of viral diseases and some companies offering such policies to give cover to specific diseases like Dengue Care, Corona Care, etc.

What Plan is the Best?

A family floater plan is the better option compared to Individual plans. You should add critical illness plan into your policy if your parents are included in family floater health insurance policy.

• • A family floater plan is always a better choice.
  • This should be based on individual’s health coverage need, family member’s age and medical history of individuals.
  • If your parents are in the age group of 65 plus than should go with a senior citizen plan separately.
  • Compare your total health insurance premium amount of both the options because premium amount goes up with the older age.

This can be a possibility of low premium if a young couple goes with a family floater health insurance plan for the family and another family floater health insurance plan for parents more than 65 years of age separately.

Golden Advice

1. We should have a minimum of one Health Insurance Policy for the family
2. If you have corporates health insurance coverage from your employer still you should have an additional personal health insurance policy
3. Parents should be insured in any cases because they are more prone to critical illnesses and another chronic disease
4. Select Policy amount wisely
5. Keep in mind a few factors like

• • Income levels
  • Premium amount
  • Sum insured of the policy which will not fall short in case of a medical emergency.

So choose your health insurance plan wisely keeping all the factors in mind and give a sense of security to you and your family.