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Life expectancy has been greatly increased, thanks to rapid advances in modern medicine. Unfortunately, living longer does not necessarily imply living healthier. Increased urbanization has also ushered in an era of sedentary lifestyles, with high stress levels and unhealthy eating habits. This has led to a rise in lifestyle diseases and other ailments, even among young adults and children.
Medical care has not been immune to the effects of inflation, resulting in the rise of health care costs by almost 15% per annum. Have you ever thought about the financial implications in case you or your family members fall sick and require hospitalization and expensive treatments? In such a scenario the implications of not having health insurance are great, as this adversely impacts your financial and physical wellbeing.
Availing health insurance cover is now a basic need. However, procuring an optimal mix of insurance cover to maximize the benefits is equally crucial. In India, people often avail minimum health coverage, with the national average being extremely low.
So how much health cover do you actually need? It is important that you maintain a practical approach and factor in the risk of unforeseen illnesses and accidents, current costs of common medical procedures, and the likely cost in the future. Also consider the costs of life-saving procedures that could be required, especially if you have a pre-existing condition. Once you consider all of these variables, you will realize that the costs of health care are a lot higher than you previously thought.
Here are some factors that you need to consider when shopping for health insurance, as they will influence the cost of insurance and your needs as well.
1. Age
This is one of the first factors you need to consider when determining the health insurance amount. It is advisable to purchase a policy at an earlier age for both financial and health benefits. You will have to pay lower premiums because pre-existing conditions are fewer. Insurers offer health plans specifically for seniors or older people that provide special features, such as shorter waiting period. Check for plans that are appropriate for your age.
2. Current Requirements
While your insurance requirements will change as you age, you also need to consider your immediate needs. If you are married with children you can consider family floater plans to get coverage for your entire family. Availing family health insurance is easier than managing individual plans for each family member. You need to consider the health status of each member however, as the coverage needs to be adequate for the family as a whole.
3. Existing Health Coverage
Many employers offer health insurance to their employees. Although this can be convenient, the coverage is often inadequate for many medical situations. Moreover, if you quit your job, the benefits may no longer be available to you. This is why it is important to consider individual plans to meet any health issues that could arise in the future. Opting for top-up coverage that is available with some deductions will offer you continuity benefits on the existing policy at an affordable premium.
4. Need for Additional Benefits
Most health plans offer standard hospitalization benefits; however, thinking beyond this is important. Users are advised to choose comprehensive plans offering additional benefits for maximum coverage. Some of these benefits include critical illness cover, personal accident cover, hospital cash, special plans for seniors, ambulance expenses, pre and post-hospitalization benefits, and other similar covers.
These additional benefits are often available through riders. If you have any specific health needs or at a higher risk of a particular condition, make sure to choose the appropriate riders.
5. Tax Benefits
According to the Income Tax Act, 1961, premium paid on health insurance policies is eligible for tax deductions under Section 80D. The maximum benefit under this section is INR 35,000 (INR 15000 for premium paid for availing health insurance for self, spouse and children and Rs. 20,000 for premium paid for availing health for parents aged above 60 years).
All of these factors should be considered when determining health insurance costs. Once you choose a plan, also be prepared to evaluate it periodically. Changes in the cost of medical care and your health status will have to be taken into account with the passage of time.
About HDFC Health
HDFC Health is an initiative by HDFC Life, a life insurance company in India to help increase awareness, spread knowledge and enshroud myths surrounding the health insurance sector in India. As a wholly owned subsidiary of HDFC Life, HDFC Health offers health insurance policies in India that cover individual, family floater, critical illness and cancer care insurance plans.