Health Insurance

What is Health Insurance? : Health Insurance is a Contract between a customer and insurance company, wherein Insurer agrees to pay the insured for health care expenses that may arise due to hospitalization, accident, illness or disease. All these expenses are paid as per policy terms & conditions.

Need of Health Insurance : Our lifestyle, plays an important role on our health condition. Long working hours, increased commutation time, Increased pollution Level – air, water & noise, Hurried lifestyle and habit of eating processed foods, lack of sleep & time , all this results in to stress. Stress leads to lifestyle diseases. A medical Emergency can strike on anyone at any time. None of us would compromise on quality of medical treatments for our near and dear ones. This results in to out of pocket expenses/ financial loss if we do not have adequate health insurance coverage.

Tax Benefits : Exemption under section 80 (D) of the Income Tax Act, 1961 is presently available.

Coverage under health Insurance Policy:

  • illness / disease or accidental injury leading to expenses - hospital charges: room & operation theatre charges, surgeon fees, anesthetist fees, nurses, cost of medicine, oxygen, blood, cost of appliances like pacemaker, artificial limbs and cost of organ donor expenses.
  • Hospitalization expenses subject to a maximum of the sum insured at inception of the policy
  • Pre hospitalization Post hospitalization expenses
  • Cashless Facility at network hospitals

Selection of any health insurance plan

  • Waiting Period & Duration before Pre-Existing diseases are covered in the Policy
  • Lifelong Coverage
  • Type of Health Insurance – basic / top-up/super top-up
  • Extra/ Additional Coverage offered if Sum Assured is exhausted
  • Maternity coverage offered
  • Day Care treatments covered
  • Product Premium
  • Co – Payment options

Health Insurance is Classified into two parts

  • Indemnity : The Insurance Company is liable to compensate the insured up to the amount of loss incurred, subject to the terms & condition of the policy.
  • Benefit : On occurrence of the event, insured is paid a lump sum amount by the Insurer as per the availability of the sum insured & policy condition irrespective of the amount of loss incurred.
  • Individual Policies: As the name indicates, the insurance cover is for a single individual. The policy holder can avail the benefits up to the sum insured he has selected along with the benefits as per policy terms and conditions.
  • Floater Policies: Here the entire family including spouse, dependent parents and children can be covered for health insurance under one policy. The total sum insured for the entire family is pre-determined. Whenever there is a medical claim for any of the family members, the claim is made from that total sum insured. If one member in the family is hospitalized and uses certain amount for his treatment, the balance amount from sum insured can be utilized by other family members during the entire policy year. Hence the family floater insurance, serves as a Jug of water kept on dining table and the entire family can utilize as per their requirements.

    Critical illness, as the name suggests is a serious health condition that has a severe impact on an individual’s lifestyle and the treatment cost is huge. India is becoming a diabetic and cardiac capital of world. More and more critical illness such as cancer are being diagnosed in india every year. The illness may result in to loss of income, change in lifestyle , inability to work or permanent disability. Due to medical advancements, people are surviving critical illness. But…every survival has a price! The victims may have to face affordability problems in treatment costs. The financial burden could be more severe than what an indemnity health insurance plan would cover. To combat this issue one needs to get a critical illness insurance. A critical illness plan works differently from a Health Insurance plan. This plan pays a lump sum amount, equal to the sum insured, to the insured on acquiring a serious critical aliment such as cancer or a stroke etc. This cover provides a lump sum benefit which can pay for the cost of care and treatment, recuperation expense and even pay off any debt if taken. Regardless of your hospital expenses, the insurer pays the full sum insured. The policy may require the policyholder to survive a minimum number of days (the survival period) from when the illness was first diagnosed. The survival period used varies from company to company.Critical illness plans are therefore defined as benefit plans.

  • Critical Illness Plan Vs Health Insurance: In health insurance policy, hospitalization is required to avail the benefits, where as critical illness insurance is a benefit policy where hospitalization is not required and diagnosis of a critical illness as per policy terms is enough to avail the benefit.
  • Critical illness insurance cover diseases like :
    • Cancer of Specified Severity
    • First heart attack of specified severity
    • Open chest CABG
    • Open heart replacement or repair of heart valves
    • Coma of specified severity
    • Kidney failure requiring regular dialysis
    • Stroke resulting in permanent symptoms
    • Major organ/bone marrow transplant
    • Permanent paralysis of limbs
    • Motor neuron disease with permanent symptoms
    • Multiple sclerosis persisting symptoms
    • Aplastic anemia
    • Bacterial meningitis
    • Loss of speech
    • End stage liver disease
    • Deafness
    • End-stage lung disease
    • Fulminant viral hepatitis
    • Major burns
    • Muscular dystrophy
  • This critical illness list is only indicative and not exhaustive in nature. Insurance companies cover a varying number of critical illnesses under different critical illness insurance policies.

Bunch of people having similarity such as working in the same organization, same occupation, etc. can form a group and the health insurance company collectively insured where each member is then insured for a particular risk cover amount with predetermined features. The premium for group insurance policy are far less than the premium of an individual policy.

Features of Group health Insurance :

  • Lower Premium Cost
  • Customized policy, even pre-existing disease can be covered right from day one.
  • Cover for all members
  • Cashless claim across network hospitals
  • Provides incentives for having affiliation with the group
  • Cover from day one of member joining the group.
  • The company can treat the premium as business expense.
  • If an employee leaves during the year, pro rata refund is provided by insurance company

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