How to plan health insurance for yourself and family

Mayank Bathwal

In today’s world of fast-paced lives, hectic schedules and everything at our fingertips, health has become a major issue. Most of us find it hard to make time for regular health and fitness activities. Unhealthy lifestyles and dietary choices are leading to an increase in silent killer diseases such as high blood pressure, diabetes and heart ailments etc. These have become prevalent across all age groups, most of them requiring constant medical intervention and care and also have long-lasting health implications.

An average Indian household generally has one earning member and multiple dependant members thus they constantly worry about the financial scenario of their families. There are also times when one falls sick and has to pay exorbitant hospital bills to get back to normal life. The trend of increasing chronic ailments is on the rise in India.

According to reports published by National Health Profile — Central Bureau of Health Intelligence and International Diabetes Federation, India is now both the cardiovascular disease and the diabetes capital of the world and the third most obese country behind US and China. This is reflected in the healthcare spends of our country with India registering world’s highest out-of-pocket medical spends.

Despite this scenario, less than 3% of the Indian population has voluntary health insurance cover. The present health insurance market has over 20 plus players offering a host of products tailor-made for various needs and budgets. But how does one know that they are buying the right health insurance plan for themselves and their family? Finding a perfect health insurance can be confusing and tedious when one has very little knowledge and plenty of options being offered by the insurance companies.

The most important step in financial planning is to create an adequate health insurance cover for yourself and family. Consumers can build their health insurance portfolio by focusing on following points:

Opt for complete protection plan: Choose a product that will help reimburse the medical expenses incurred.

Inclusions and exclusions: Get well versed with the inclusions and exclusions of your policy. There are certain medical conditions which are not covered under a standard health insurance policy. One must also avoid restrictions like co-pay and room type choice.

Waiting period: One should avoid selecting policy with waiting period for pre-existing medical conditions and futuristic medical conditions e.g. cataract surgeries generally have two years waiting period but in case of no waiting period the treatment can be immediate along with a planned hospitalisation.

Opt for add-on cover: Customers should opt for cost-effective policies which not just take care of hospitalisation expenses but also cover OPD expenses, hospital cash, the second opinion consulting.

Top-up/deductible plan: It is an additional sum assured to your existing policy which comes with a low premium. Whilst most of the corporates provide health cover for employees but with the rising medical inflation it has been observed that it is inadequate. So going for a top-up cover is advisable. Also, one must buy a separate base policy which can act as a back-up when the initial sum assured is exhausted. This will ensure adequate cover and most importantly one remains covered in case of job change/loss of job. Also, at the time of retirement one might have morbid condition and would be ineligible for policy cover. Hence, it is advisable to buy a retail policy at an early age.

Critical illness cover: If a person already holds a health insurance plan (Mediclaim or Family Floater), maybe it's time to consider creating a second financial buffer through critical illness health insurance plan. A major illness has a debilitating effect on the one’s life; a specific ailment like cancer can collapse the financial stability of a household. Critical illness plans are therefore defined-benefit plans as the payout is defined and fixed.”

The truth with health insurance is the benefits of cover is far more than cost of insurance. Most importantly, it ensures that you always have access to timely medical care, and it removes the financial stress and allows you to focus entirely on health during an emergency.

Nowadays there are added benefits of access to super speciality hospitals and clinics in partnership with the insurance company, second opinions with experts and the ability to go ‘cashless’ for the entire duration of the illness which otherwise would have been out of reach of the general populace and resulted in a large financial burden. Having health insurance is the answer for such predicaments.

If your existing policy is insufficient, consider adding top ups to the same. If you are planning to purchase a new policy, educate yourself about existing polices and understand your requirements in order to make the best choices. As today’s health insurance product is no longer a reimbursement tool, a large number of consumers are now looking at products that provide wellness solutions and rewards. The healthy customers now have the option through innovation in the design of product which offers incentives based on wellness and preventive aspects. With the help of a holistic ecosystem they can now get to know about their actual health status, improve their health by staying active and get rewarded. And in case of any medical uncertainty, the insurer stands beside them to take care of their medical expenses.

To summarise, health insurance products have come a long way and they are slowly moving towards being your true health companion. So when you decide to buy, opt for the one that not only covers you for those unfortunate events, but also becomes your health partner who would motivate and empower you to be healthy.

The writer is CEO, Aditya Birla Health Insurance Co. Ltd. The views expressed in this article are his own