Know These Things Before You Buy A Health Insurance Policy

Most financial planners suggest purchasing a health insurance plan to be the starting point of all financial plans.

- Manish Jain

Even before one starts investing towards one’s goals, getting an adequate health insurance cover for self and family helps.

According to estimates, out of the overall health expense, government spends less than 20 percent of total health care spends. So, the private expenditure is more than 80 percent out of which, more than 90 percent is out of pocket. This is the damaging part. Some studies suggest that about 40 percent of out-of pocket expenses people have to borrow or sell assets. Just about 12 per cent of the population is covered under some sort of health insurance.

Here, we look at the various important features and factors of a health insurance policy that may help you zero-in to the right policy.

Why to get health cover?

According to few studies done in the past, the medical inflation in India is around 17 per cent annually, much above the general inflation level. The need for adequate health cover is increasingly becoming imminent and choosing the right health insurance plan is equally important.

If you think you are in the pink of health, its good but a health insurance is not only about illnesses and diseases. It’s a universal truth that accidents may occur anytime and at any age. A health cover could come handy in such an event. Further, at times, certain ailments remain unknown to us until their symptoms are visible. Although, not a mandate, a policy bought at an early age and renewed for quite some years without any claim, may help in better claim experience as and when it arises.

What kind of health cover do you require?

The health insurance plans are broadly categorized as ‘Indemnity plans’ and ‘defined-benefit plans’. While, Indemnity plans reimburse the hospital expense, the defined benefit plans pay-up a lump sum amount irrespective of the actual hospital expense.