The structure of modern, industrialised society has undeniably brought us immense benefits, but there is one area where it arguably has also brought a new set of challenges - health. Although the lifespan of the average human being has significantly increased from what it was a hundred years ago, new diseases are cropping up in larger numbers than ever before. Many experts argue over the contributions of factors like stress and pollution and their contribution towards aggravating or even creating these health conditions in the first place. Of course, we cannot go back to the stone age to tackle this issue, but there are far better alternatives.
A promising one is a good fitness regimen that lowers one’s chances of being severely unhealthy and the other would be health insurance policies. However, given the costs and conditions associated with these health plans, it can be difficult to understand which one should you choose - an individual or a family plan and what is the best health insurance plan in India? By the time you are finished reading this piece, you should have a clear idea.
What are individual and family health plans?
If health is compromised, everything else seems futile. This is why a health plan should be the first option for investment. Health insurance policies are legal agreements through which insurance companies assure the payment of stipulated medical expenses for the policyholder. According to the clause of the agreement, these coverages can be cashless or reimbursement of medical bills. A health policy may not be the best investment plan for wealth creation, but it does increase the chances of wealth accumulation because it would devoid you of the pain of burning through your savings in case of medical issues.
Knowing the difference between individual and family plans and their coverages can help you make the best decision.
Individual health insurance plans are agreements between an individual and the insurance company and hence, they are the only party covered. In this case, all interested family members have to be insured separately. A dedicated and assured sum is reserved for the insured party through these plans. Arguably, you might end up spending more, if you intend to have your entire family covered with individual health plans.
Other than coverage for the medical bills, there are certain advantages to these kinds of health plans, such as:
Daily Allowance for Hospitalisation
Varying per a set minimum number of days, the individual insured gets a fixed amount per day in case they get hospitalised. Although this depends on a bare minimum number agreed upon by both the parties through the agreement, this provides a certain peace of mind in case of an unfortunate hospitalisation.
The government’s policies allow every individual to claim income tax benefits under section 80D, leading to the premium invested in such policies to be deductible from total payable tax.
Individual health insurance plans can be purchased with cashless benefits. Many companies offer these plans wherein you can avail cashless services in a hospital, meaning a mere copy of your insurance plan would enable you to avoid the bills. The insurance company takes care of it and it is adjusted through a claim between the hospital and the insurance company.
In contrast to their counterparts, health insurance for family equips you with a floater sum, insured in the name of your family. This amount can be utilised in case of hospitalisation of any family members.
While individual plans need only one insurer, family plans usually incur premiums based on the age of the oldest family member. It is usually recommended that younger families get covered under these plans, to avoid paying higher premiums. But remember one thing, an individual health insurance plan or a family health insurance plan needs not to be the best investment plan for wealth creation. Hence, the premium should not be the only deciding factor.
There certainly are many advantages to these plans as well.
Larger Insured Sum
These plans provide a larger sum as health insurance for family, wherein most companies provide cover for one’s spouse and children, while some plans also allow adding your dependent parents, siblings and parents in law. Some plans also provide the flexibility to add more sum after a certain tenure.
While individual plans give you a narrower coverage, family health insurance tends to cover a broader spectrum of services like medical procedures, doctor consultations, ambulance covers, hospital staff care. Some policies, like the star family health optima, even provide for medical check-ups for a year!
Many insurance plans these days come with an increased, auto-renewal cover for a couple of years. Without the hassle of renewing them each year, you get a certain peace of mind that the unforeseen health emergencies would be taken care of, for a longer duration.
Certain differences can further help you decide which is the best health insurance plan in India for you.
Fewer plans cover relationships beyond your spouse and children. If you want to get elders in your family covered, you might want to get them individual plans, which would perhaps be the only option in case they are older than the age limit set by the insurance provider.
When children covered under a family health plan are no longer minors, they no longer get credits and waivers that minors get.
There can be a lot of differences between plans that hover around the same premium figures but offer more services than others. Star family health optima, for instance, provides a larger coverage amount than many other family plans in the same league.
If you feel sad at the loss of premium with your current health plans after a year, you might want to switch to a plan that offers a ‘No Claim Bonus’. These bonuses make sure you get some part of your premium back if you made no claim within the period of insurance in the form of cashback or other rewards. Better something than nothing, right?
In family plans, the insurance companies offer renewals or new policies up to an age limit. Once one senior cross that age, other family members would not be able to continue the plan or get another renewal.
The majority of differences between both these plans lies in the coverages the two provide. Based on your specific requirements, medical history, age and dependents, you can go for an individual or a family plan. A family health plan is better, especially if you want to steer clear of hassles like managing different policies and remembering to pay their premiums.