A health insurance plan forms an important part of the financial portfolio as it plays a vital role in managing escalating medical costs and unexpected medical expenses. When your health insurance plan takes care of your treatment and hospitalisation expenses, you don’t end up exhausting your savings. Thus, this helps in better financial planning for yourself and your family. To avail the benefits of a health insurance plan, it makes sense to be aware of various aspects of this insurance in order to take an informed decision while buying one.
To clear all the confusions hovering over health insurance, let us understand the broad categorisation of health insurance. It can be classified as Family Floater Plan and Individual Health Plan. Both fall under indemnity plans, where the hospitalisation and treatment expenses are borne by the insurance company. Let us look at the features and advantages associated with these plans.
Individual Health Insurance Plan
Under an individual health insurance plan, only the person purchasing the insurance plan is covered. He/she can claim the monetary compensation for the incurred medical expenses. However, this amount should not be above the sum insured or the maximum amount to be claimed by the policyholder. Under this plan, the premium is calculated on the basis of an individual’s age and the sum insured.
An individualhealthinsurance plan has its own advantages. There is no age restriction for policy renewal of this plan, which is suitable for individuals with higher health risks. It makes sense to opt for this plan if you have dependents who have a higher chance of suffering from various health risks.
Family Floater Health Insurance Plan
As part of the family floater health insurance plan, more than one family member is covered under a single policy. The coverage provided by the plan is common to all the members. Thus, if a family memberis hospitalised, the expenses incurred will get deducted from the sum insured. The remaining amount can be claimed by other family members, in case a hospitalisation is required in the same policy year.
This type of plan makes sense for a family, considering the fact that there is low probability of each member falling ill at the same time or in a whole year. The plan is cheaper compared to an individual plan as the premium paid for individual plans is higher compared to a consolidated premium for a family plan. Here immediatefamily members, such as spouse and kids, can be added. Apart from this, you also have the option of including your parents and in-laws in your plan on payment of some extra amount. However, it is recommended not to include older family members in family floater plans, as it directly impacts the premium of the plan by increasing it. Apart from this, it might happen that the older member exhausts the entire sum insured and nothing is left for other members in the same policy year.
Thus, both the types of health insurance plans have their own advantages and disadvantages. It is best to understand your requirement and affordability well before zeroing in on a particular plan. Before purchasing a health insurance plan or mediclaim policy, know the other types of health plans as well like senior citizen plan, cancer plan, critical illness plan and personal accident plan. Also, compare various plans and insurance companies to get the best deal and avoid any kind of financial burden.