It is an arrangement or by means by which a company or an organization compensates for the loss of property, life etc…
Health insurance and life insurance
health insurance is a means by which we get our hospitalization charges or health-related issues covered. Life insurance is a means by which nominee of an expired or deceased person receives the pre-assumed amount of money.
Health insurance and Mediclaim policy in detail
people often mistake that health insurance and mediclaim as synonyms, they are actually two separate entities. In short, mediclaim covers only for hospitalization charges whereas health insurance is comprehensive as it covers pre, post-hospitalization charges and financial loss caused due to illness in that period.
Mediclaim policy defrays your expenses only if you are hospitalized. Modes of coverage are cashless and reimbursement same as health insurance as mentioned below in the health insurance section. Tax emption is an advantage for opting medclaim policy whose particulars are same as health insurance which is discussed in the health insurance section. There are three types of mediclaim plans offered generally.
In this plan, the individual’s medical expenses are covered in case of illness or surgery or an accident occurrence. The individual has insured the specified sum during the policy agreement.
Floaters (family plan)
This plan is for multiple people verified as family members. In this plan, the premium per person is lesser than the individual policy.
Unit-linked health plan
This can be called insurance and business plan. In this plan, the insured has to pay a premium amount and investment. After the term period, the insured will receive a sum of money which depends upon the market. Caution: this plan is subjected to market risks.
Quick list to be checked while buying a mediclaim policy
- In case of a family floater plan when the primary person expires the rest of the family can’t renew the policy or enjoy the benefits.
- Renewability of the policy should be checked
- In the case of pre-specified diseases, few companies have a policy that the insured enjoys insurance if and only if the policy is continued to 10-15 years.
As mentioned above health insurance covers transportation charges and hospitalization charges. Add-ons such an as ambulance charges are also covered(you should check this while you are signing for the policy). There are two ways to defray your expenses: cashless and reimbursement.
Insurance companies are linked to many hospitals throughout the country, these hospitals are called impaneled hospitals or network hospitals. If you get admitted at any of these hospitals all you have to do is fill a form given to you in the hospital and wait for the approval of third-party administrators of your insurance company or your insurance company itself. If the expenses exceed the policy premium amount you have to pay the rest yourself.
If you are not admitted in impaneled hospitals of the insurance company, you will have to pay the expenses yourself, later you can submit the medical bills and receipts to the insurance company and get reimbursed the amount you spent.
Different type of health insurance policies
Individual health insurance policy: In this policy, the individual is insured for the pre, post-hospitalized expenses and the loss incurred due to the illness.
Family floater insurance policy: in this policy the family enjoys the insurance in the policy tenure. Family insurance costs more than an individual policy.
Maternity policy: In this policy, the transportation and medical expenses of the pregnant lady are covered.
Senior citizen insurance policy: in this plan citizens above 60 years are insured. Senior citizens enjoy tax exemptions up to a maximum of Rs 30000 annually.
Critical illness policy: in this plan if the insured is diagnosed with any of the illness or disorder agreed at the time of activating the policy he will receive a lump amount of total sum.
Sudden accident policy: in case of an unexpected or unforeseen accident resulting in death or damage, a lump of the sum will be paid to the insured. Note: he may not receive the total premium.
Pre-existing disease: after waiting period of 2-4 years insurance companies start covering for the insured for the disease existing prior to the policy activation.
Unit-linked health plans: this can be called insurance and business plan. In this plan, the insured has to pay a premium amount and investment. After the term period, the insured will receive a sum of money which depends upon the market. Caution: this plan is subjected to market risks.
Prevention policies: this policy covers for health checkups and the medical expenses which pertain when taking measures to prevent illness.
Features and advantages of health care policy
Coverage of pre and post hospitalization charges, tax exemptions according to 80d act maximum of 25000rs annually can be exempted this serves as a subsidy to the medical expense. For senior citizens( age above 60) 30000 is the max amount exempted annually. If you are paying insurance to your parents and yourself 55000rs is the max exempted tax per annum. Coverage of ambulance charges(should be checked at the time of policy agreement). No claim bonus: in the case of no claim during the precious policy tenure year, a bonus is added to the assumed insurance or the premium amount which is to be paid per month is reduced. Free health checkups if the insurance is not claimed in last 2 policy years.
Important Things to remember while buying a health insurance policy
- We cannot really say the certain company is best for insurance or certain policy is best. It always depends upon the individual choosing the policy. Suppose if you smoke and likely to get cancer choosing a critical illness policy is better than choosing a normal health care policy.
- Pay attention the ICR (incurred claim ratio) which indicates the ratio to the amount claimed to the amount collected as premium. Higher the ICR better is the company. Following is the list of ICR(latest) of various companies.
|MAX BUPA HEALTH INSURANCE||51%|
|HDFC ERGO HEALTH INSURANCE||76.9%|
|BHARATI AXA HEALTH INSURANCE||76.8%|
|SBI HEALTH INSURANCE||75.1|
|BAZAZ ALLIANZ HEALTH INSURANCE||78.5%|
|RELIANCE HEALTH INSURANCE
NATIONAL HEALTH INSURANCE
Differences between mediclaim and health insurance:
|Coverage only for hospitalization||Pre and post hospitalization charges, loss of income due to illness is covered.|
|Does not provide coverage for critical illness||Provides coverage for critical illness|
|The sum of the plan’s policy should not exceed 5 lakhs||Up to Rs 6 crore|
|Insurance can only be claimed if hospitalized||Insurance can be claimed for health checkups|