Types of Health Insurance
Health insurance is undoubtedly one of the safest and most cost-effective ways of protecting your finances. It is an important decision that requires careful thinking while purchasing. However, to select the best plan, we must first know about the types of health insurance plans available in India.
Owing to the exponential upsurge in quality healthcare expenses, it has become compulsory for everyone to have health insurance. Health insurance manages those unexpected financial burdens that arise out of accidental hospitalisation or illness. Buying health insurance in India is easy, but you have to approach it right. Hence, to ensure sufficient cover, you must be well aware of the types of health insurance policies. Below is the rundown on the different kinds of health insurance that you can consider as per your insurance needs:
There are broadly two types of health insurance policies:
a) Indemnity Health Insurance
Indemnity plans are the traditional health insurance that covers your hospitalisation expenses up to the sum insured. These plans include:
- Mediclaim InsuranceMediclaim insurance compensates you for the hospitalisation expenses incurred due to illness or accidental injury. It includes in-patient expenses such as nursing charges, surgery expenses, doctor’s fees, oxygen, anaesthesia etc. This insurance is known as Mediclaim policy and is available in the market as group mediclaim, individual medical insurance, overseas medical insurance etc.
- Individual InsuranceIndividual insurance policies only cover individuals. Under this policy, an individual receives the incurred amount during hospitalisation. The insured gets to claim up to the basic sum insured. This policy may also include member coverage, implying that the covered members get the individual sum insured. For example, if you own an Individual health cover of Rs. 1 lakh that also covers your spouse, then you both get to claim up to Rs. 1 lakh individually.
- Family Floater PlanThis policy comes with a twist and covers the entire family. A Family Floater health insurance policy allows cover for the complete family under a single plan. The sum insured is equally divided among the members. The most notable benefit about this policy is that the premium paid by the policyholder is comparatively lesser than individual or mediclaim policies.
- Unit Linked Health PlansUnit Linked Plans or ULIPs are investment cum insurance plans with the dual benefits of investment and insurance. This plan allocates a portion of the paid premiums, applying it in the stock market, and the insured gets insurance coverage. The returns are dependent on the performance of the market.
- Group MediclaimOffered by medium or large scale enterprise employers, Group Health Insurance plans are gaining popularity. This policy helps retain the talent within an organisation. With health insurance plans becoming imperative, the employers cover their employers for a financial crisis and prudence.
b) Definite-Benefit Plans
Under a defined-benefit plan, the insured is compensated a lump sum amount on the detection of illness. These plans include:1. Critical Illness Plan
This plan treats certain specific illnesses. With lifestyle diseases on the rise, cover against illnesses has become vital. As the treatment for these ailments can be an expensive affair, especially for middle-class families, buying critical insurance can mitigate those expenses up to an extent. On the detection of an illness, this plan pays a pre-decided amount towards treatment. The policyholder receives this lump sum regardless of pre or post hospitalisation expenses. Major diseases covered in most critical illness plans include:
- Major organ transplant
- Cancer stroke
- Aorta graft surgery
- Multiple sclerosis
- Kidney failure
- Paralysis
- Coronary artery bypass surgery
- First heart attack
- Primary pulmonary arterial hypertension
2. Hospital Daily Cash
This coverage is provided as an in-built cover under the health insurance coverage by some health insurers. This policy pays the insured with a daily cash allowance up to a given limit, besides hospitalisation expenses.3. Personal Accident Plan
This policy covers the owner/driver against an accidental injury or death. A lump sum amount is paid to the insured or their family in case of death, loss of income due to permanent partial or total disability.
