Health issues are constantly and rapidly rising due to unhealthy lifestyle and eating habits. Moreover, healthcare costs are also rapidly and exponentially increasing, that burn a hole in the patient’s or their family’s pockets. In order to avoid these high expenditures and the stress arising out of financial burden, health insurance plans come to your rescue. Insurance companies provide different types of health insurance plans for the buyers to choose the plan that best suits their requirements and necessities. The details of each plan vary according to their nature, and the level of coverage that they provide. These plans are the most cost-effective and essential way of protecting your finances, as they help mitigate the unexpected financial burdens that arise out of healthcare expenses of hospitalization and medication. Apart from the emotional support, financial support is also highly essential in times of medical emergencies. Taking care of the financial expenses helps relieve the emotional and mental stress as well. This is where different types of health insurance plans come to rescue.

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Different Types of Health Insurance Plans in India

Before buying your suitable health insurance plan, it is very important to understand and have knowledge about the available types of health insurance in India. You can consider the features and benefits that each plan offers, in order to decide and finalise your most suitable health insurance plan. The types of health insurance policies available in India are as follows:

  • Individual Insurance Plans :

    Individual insurance plan is the most common type of health insurance plan available in India. As the name suggests, this type of health insurance plan covers only an individual and takes care of the hospital and medical costs of the policyholder. The benefits of this plan can be availed only when the individual is hospitalised. Various personal factors such as age, gender, medical history, etc. determine the rate of premium in individual insurance plans.
  • Family Floater Insurance Plans :

    As the name suggests, family floater insurance plan provides coverage to the entire family in case of health emergencies. It is similar to the individual insurance plan, except for the fact that the sum insured in this plan is generally higher and gets shared among the family members who are part of the plan. One of the main benefits that this plan offers is that there is no need for buying and managing different policies and plans for different purposes and individual needs of all the members. Family floater insurance plan is also more cost-effective than buying individual policies for each family member.
  • Critical Illness Insurance Plans :

    A critical illness insurance plan insures and provides coverage against critical and life-threatening diseases like heart attacks, paralysis, cancer, kidney and liver ailments, etc. Under this insurance plan, the policyholder receives a lump sum amount at the time of diagnosis of a critical illness. Unlike the individual insurance plan, no hospitalisation is mandatory for claiming the money. Critical illness insurance plan is ideal for people who have a family medical history of such illnesses.
  • Senior Citizen Insurance Plans :

    Senior citizen insurance plans are specifically designed for senior citizens above the age of 60 years. The premium to be paid in this type of a plan is usually higher than other plans, as older people are more likely to make a claim against health issues. Any kind of pre-medical screening or scanning of pre-existing diseases are required by many insurance providers, as old age often bring illnesses and health conditions.
  • Personal Accident Insurance Plans :

    Accidents have become very common in today’s times. The expenses that they cause are also very high, and can drain all your savings. A personal accident insurance plan provides coverage for the cost of medical treatment that is required after an accident. Usually, personal accident insurance plan offers coverage and benefits against three of the following major events: death due to accident, total disability due to accident, or partial disability due to accident.
  • Maternity Insurance Plans :

    Maternity insurance plans are special plans that provide coverage for pre-natal and post-natal expenses along with costs of ambulance and delivery. Under this plan, another special plan with a baby cover is also provided, that covers the expenses related to the new born baby up to a certain period of time. Most of the maternity insurance plans get active after a certain waiting period, hence it is most advisable to buy these plans as soon as the woman gets married. Maternity insurance plans are also available as add-ons to other general policy plans.

Reasons to Buy Health Insurance at Young Age

Before you buy a suitable health insurance plan, it is important to understand the reasons to buy it. Here are some of the benefits and reasons of buying the most suitable health insurance plan for yourself and your family at a young age:

  • Easy to Avail Insurance :

    It becomes quite difficult to avail health insurance at the time of existing health issues. Doing so would also cost you higher rates of premium. If you fail to disclose at the time of buying, and end up claiming for a complicacy that arises out of such undisclosed illness, you will end up getting your claim rejected. On the contrary, you are healthier and have lesser health-related issues, due to which it becomes easy to avail health insurance.
  • Pay Lower Rates of Premium :

    Health insurance plans bought at a young age cost lower rates of premium payment to be made. As an individual is more likely to face illnesses and health issues at an older age, insurance providers charge higher rates of premium for individuals buying health insurance at this age. While an individual is less likely to fall sick during younger years, the rate of premium charged is low, due to the low-risk appetite.
  • No Waiting Period :

    Health insurance plans come with waiting periods. Generally, there is initial waiting period of 30 days, and a pre-existing illness waiting period of 2 to 4 years. However, this differs from one insurance provider to another. During your younger years, you are healthy and there are no health-related complicacies, due to which you do not need to make any claims for your health insurance. Due to this, you can serve the waiting period and file your insurance in a hassle-free manner.
  • Save More on Tax :

    Under Section 80D of the Income Tax Act 1961, the insured individual gains benefits in the form of deductibles from paying tax, against the premium paid by him/her. By buying a health insurance at a young age, you can avail tax benefits for a longer period of time as compared to someone who bought the insurance in the middle or old age.
  • Reap More Savings :

    Health insurance is a kind of investment to help cover your unforeseen financial needs in the future. Investing in a health insurance plan from a young age would help you inculcate the habit of saving, which would be very helpful and beneficial in times of constant inflation.
  • Avail Benefits of Bonus :

    MHealth insurance comes with the additional benefits of bonuses. One such benefit is the No Claim Bonus (NCB), that is offered for not claiming your insurance. This bonus ranges from 20% to 50%, and is offered as a discount in the premiums paid or as a hike in the sum insured. Being young and healthy brings in lesser chances of claiming your health insurance, due to which you can avail the no claim bonus benefits more easily and thus make the best of your policy.

Types of Health Insurance Frequently Asked Questions (FAQs)

Life insurance is a type of insurance that covers the risk of life and pays out a pre-assured amount in case of the death of the insured individual. Health insurance is a type of general insurance that covers the medical expenses of the insured individual, but only up to the amount covered.
Before choosing the most suitable health insurance plan out of the different choices available, one must consider certain factors like premiums, no claim bonus, waiting period for specific illness, co-payment availability, waiting period for pre-existing illness, maximum renewal age period, network hospitals, incurred claim settlement ratio, critical illness add-on option, inclusions and exclusions, coverage amount and sum insured, etc.
Generally, the value of healthcare insurance is subjective, and depends on the type of plan bought by you, and the level of coverage it offers. However, as per gross statistics, a family floater policy plan of Rs. 5 lakhs, that covers the self, spouse, and one child will cost between Rs. 10,000 to Rs. 17,000 on an annual basis; and a Rs. 5 lakhs individual health plan will cost between Rs. 4000 to Rs. 7000 per year to a middle-aged individual.
There is no specific mandate age for buying health insurance, but it is better to buy one at a young age to avail more benefits, like lower premium, more additional bonuses, escape pre-existing disease waiting period, financial planning and more savings, vast amount of choice, more tax benefits and deductions, etc.
The list of offered network hospitals keep on changing in a health insurance policy plan. Some hospitals remain while other new ones are added. Hospitals need to fulfil the requirements in order to continue staying on the list. However, there are instances where the hospitals deny cashless claims for certain insurance providers in case of any issues, payment delays, or disputes. Moreover, if a health insurance plan offers a long list of day-care procedures, it does not necessarily mean that it is a better plan. Hence, the buyer must consider all the over-all factors before making the final decision.
The consequences of not paying your premium on time, or renewing it before the due date would lead to serious consequences, including no coverage provided at the time of claim, denial of policy renewal from the insurance provider, losing out on the benefit of no claim bonus (NCB), waiting period getting re-set and having to wait for a longer time.
Under Section 80D of the Income Tax Act 1961, individuals paying regular and timely premiums for their health insurance plans can avail benefits of tax deductions up to Rs. 25,000, if they are less than 60 years of age, and up to Rs. 50,000 if they are above the age of 60 years. If both the taxpayer and their parents for whom the policy is bought are above 60 years of age, then they can avail benefit of up to Rs. 100,000 under this provision.
A family floater plan covers all members of the family under a single plan. The sum assured can be sued for the benefit of any member in the family. If a claim is made by one member of the family, the insurance coverage for the rest of the family members is reduced for that particular year. If the proposer, who pays the premium, dies, the policy can be transferred in the name of another member of the family, under the condition that he/she is a major.

Disclaimers:

The article is meant to be general and informative in nature and should not be construed as solicitation material. Please read the related product brochures for exclusions, terms and conditions, warranties, etc. carefully before concluding a sale


Consult with your financial advisor before making any decisions on insurance purchase.

*Tax benefits are as per the Income Tax Act, 1961, and are subject to any amendments made thereto from time to time’

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