The need for importance of Health Insurance or having a health policy is a very important one and yours truly got a dose of it himself when he was whisked into a hospital for a week with acute viral fever.
Being loaded with adequate health cover (also called mediclaim in India), I was safe with cashless hospitalization but are you ? Do you realize why is having health insurance so important and that too of an adequate amount ?
We look at some important reasons for importance of Health Insurance policy in your financial planning.
1. No insurance means financial burden for an individual
For individuals and families that are not having mediclaim or little, any hospitalization means spending money from their pocket to pay the hospital. With the current medical costs in India and worldwide rising year after year, this can set you back big time.
In a country like India where you still boast of joint families and support to elderly parents, the probability of hospitalization each year is more. If you keep paying from your pocket each year, then essentially you have lost the plot of making money. Being uninsured is a dumb move to make.
2. Being under-insured can lead to inadequate medical care
Having a health policy is important and this is highlighted in the many occasions when you walk into a hospital for treatment and the first question they ask you is “Do you have insurance ?”.
If you do, good luck.
If not, they ask you to first pay up some amount as deposit before they can hospitalize you. Then they keep asking you for more money on a timely basis to make sure you can pay them.
But what happens if you do not have the money to pay them ? They will obviously chuck the patient out and it is for this very reason that begin under-insured leads to inadequate medical care. A patient with mediclaim will be subject to more tests and care than one without one.
It has been observed that no mediclaim can lead to more fatal outcomes for an individual. The inadequate medical care over a long period of time proves to be detrimental for the person.
It is but obvious why having a health cover is important or we can say here we understand the importance of health insurance.
3. Covering pre existing diseases
It is a no brainer that one should look to have a pre existing diseases policy.
The IRDA (Insurance Regulatory and Authority India) has mandated a maximum of 4 years after which your pre existing diseases need to be covered by your mediclaim policy but the health insurance companies could cover it much earlier as well.
Remember that the probability that a pre existing disease recurs again is more than a new one happening, so this makes it more important for one to ask why having a health cover is important these days and especially for pre existing diseases.
4. And then there are other policies apart from mediclaim
Importance of health insurance or Mediclaim is meant when you want to cover a 24 hours hospitalization.
But what happens if a critical illness strikes you. Something like cancer will exhaust the limit of your mediclaim very quickly. Will you put in your own money towards treatment then ?
That is precisely why a medical corpus is needed. Today’s medical emergencies are such that a simple mediclaim policy does not suffice. You need more policies.
Take a personal accident insurance policy in case you have an accident and cannot work for sometime.
Avail a a critical illness policy for prescribed critical illnesses.
Buy mediclaim for your entire family. For your young family, a family floater will do but for elderly parents, go for individual health insurance policies.
Form a medical corpus for you and your family.
If you want to stay healthy and sound, you need all off these policies. Not having one can come back to haunt you at the time an illness strikes and that is when you might realize importance of health insurance.
It is better to be safe than sorry. So are you missing on any of these ?
Sorry to hear about the hospitalization.
Thanks for the article, I fully agree with the points you have brought out esp point 2. I think it’s the most important.
Take care.
@Sagar, Thanks for your wishes – yes point 2 is very important.
Nice article.
I personally think that a layman lile me who earns less cannot really afford all of these polciies. For example, the critical illness policies are very expensive.
Do you know how much % of you salary can be with premiums of such policies. Some people like me can have very less income.
@Khalid, That is a fair question to ask but have you done the math on how much money will you lose if a critical illness like cancer wil happen ?
If you do not have the money, then you can as well take the most mandatory insurance policies to begin with then come to the rest later.
There will be many cases where you can be 100% covered and not lose too much money.
Hi Radhey,
Hope you are all right now. Take care. I did realize something as there was no article since the Independence day one, normally you do once a week.
Ya health insurance is important. I personally experienced this last year exactly at the same time and health insurance saved me.
@Chirag, I am recuperating but its bad. Thanks for asking and take care, the holiday season just begins and we all want to be healthy and happy.
Radhey,
Sad to hear about your illness, was wondering why you had stopped posting. Hope you recover soon.
Rakesh
@Rakesh, Thanks Rakesh. For now, he has been advised complete bed rest which is what he is doing. Many thanks for your wishes.
Radhey,
I am 27 years old. Single
I have taken Term Insurance from SBI smart Shield. Now I am planning to take Health insurance from Apollo Munich. Should I take Health insurance with Critical illness option or go for separate critical illness policy.
Also I am planning to take Personal Accident Cover from oriental Insurance (NagrikSuraksha Policy) where the premium is very cheap.
Share your thoughts.
@Ramachandran, Take critical illness as a separate policy. I cannot share on how these policies are because that requires in depth analysis, but you are doing the right thing by taking accident cover and health cover. Go for it.
Thanks Mayura.
Term Insurance
Health Insurance
Critical Illness
Accident Cover
Four Insurance policy for an individual, Is it too Much or I am doing fine?.
@Ramachandran, You are doing fine. If you need it, you need it – you cannot skip them. Go ahead.
Thanks Mayura.
Another point I would like to add to this article is about health insurance from your employer.
A lot of people think that they have adequate coverage from their employer so why bother taking from their pocket. But what if: –
– you get sick while you are moving between jobs.
– your company has a notice period of 2-3 months and your health insurance is not valid while you are serving notice.
– your company is giving coverage only to you and not to your family.
– your SA from your company is inadequate.
I think there are plenty of reasons to have your own health insurance and not just relying on your employer.
@Vivek,
Very good points, even i used to delay my health insurance due to the above reasons. I put them on hold for nearly 5 years but later realized that i could be in trouble if i am in between-jobs. Finally managed to take one from national insurance.
@Rakesh, Thanks for sharing your experience Rakesh, hope everyone becomes wise like you sooner rather than later.
Even I am planning to streamline mine this year.
@Vivek,
I have been trying to convince my friend to buy health policy for over 6 months but he still keeps ignoring and telling why to waste more money when the company covers it.
It is indeed very important to have a health insurance in place for medical expenses. You may resent having to pay a monthly premium, but at least you know that if there is ever a time when you or a family member needs treatment, cost will not be an issue.
Much of the problems regarding funding of private healthcare services in India is the same across the world. The fact is that demand for private doctors and specialists allow them to drive up the costs, often beyond what the average man can afford from his pocket. Medical insurance is a necessity rather than a luxury but even then it cannot always cover the exorbitant fees that some specialists who claim to be the top in the field are asking.
I am not an Indian citizen but had a the experience first hand when holidaying in India and went to a private hospital in South Delhi. Fortunately I had travel medical insurance but still had to pay some from my own pocket. As a person in the medical insurance business in my home country, I was shocked at just how much of a difference there is between what the doctor asked and what the policy was prepared to pay out. But as you said, better to have the insurance and be safe than sorry.
Very informative article Radhey sir, I agree with all your points they all are relevant and everyone should be aware about it.. I would like to add from my behalf that one should always compare the policies online before making a purchase decision.. There are websites like http://www.policyx.com/ from where one can easily compare and avails the best services that fulfills all their requirements..