Importance Of Health Insurance: Why You Should Buy It?

Health insurance is essential for safeguarding against rising medical costs, offering financial security during unexpected health emergencies. It covers hospitalization, treatments, and more, ensuring that individuals and families receive quality care without financial strain. With increasing healthcare expenses, having health insurance is no longer a luxury but a necessity for protecting savings, reducing out-of-pocket costs, and ensuring peace of mind. Choosing a reliable health insurance plan ensures comprehensive coverage, making it a vital part of financial planning.

What is Health Insurance

Health insurance is a financial safety net that covers medical expenses arising from illness, injury, or hospitalization. It ensures individuals can access quality healthcare without facing financial hardship. Policies typically cover hospitalization costs, surgeries, treatments, and preventive care, depending on the plan chosen. With the rising cost of medical services, the importance of health insurance lies in its ability to protect savings and provide peace of mind. It also offers tax benefits, making it an essential part of financial planning for individuals and families.

The Importance of Health Insurance

• Financial Security: Protects against skyrocketing medical expenses, ensuring that savings remain intact during emergencies, and reducing the need for loans or selling assets to cover healthcare costs.
• Access to Quality Healthcare: Grants entry to top hospitals, specialists, and advanced treatments without immediate out-of-pocket expenses through cashless hospitalization facilities.
• Covers Major Expenses: Includes hospitalization, surgeries, daycare procedures, ambulance charges, critical illness treatments, and pre- and post-hospitalization costs, providing extensive coverage.
• Tax Benefits: Offers deductions under Section 80D of the Income Tax Act, allowing policyholders to reduce their taxable income by claiming premiums paid for themselves and family members.
• Peace of Mind: Provides reassurance and preparedness for unforeseen health crises, ensuring your family’s well-being is safeguarded without financial strain, making it an essential part of financial planning.

Benefits of Health Insurance

• Financial Protection: Safeguards your savings from hefty medical bills, covering surgeries, hospital stays, and critical treatments, ensuring you don’t face financial hardships during emergencies.
• Cashless Treatment: Offers seamless hospitalization at network hospitals, where the insurer directly settles bills, removing the need for out-of-pocket expenses during stressful times.
• Critical Illness Coverage: Provides a lump sum payout for life-threatening conditions such as cancer, stroke, or heart disease, helping manage treatment costs and lifestyle changes.
• Pre- and Post-Hospitalisation: Covers diagnostic tests, consultations, and medications before admission and follow-up treatments post-discharge, easing the financial burden beyond hospitalization.
• Tax Benefits:

Why Should You Get Health Insurance?

• Financial Security Against Medical Emergencies: Protects your finances from unexpected healthcare costs, ensuring you receive necessary treatments without financial stress.
• Access to Quality Healthcare: Provides access to top hospitals and medical facilities through cashless treatment options.
• Coverage for Critical Illnesses: Offers financial support for severe medical conditions like cancer, stroke, and heart diseases.
• Tax Savings Under Section 80D: Health insurance premiums offer tax benefits, reducing your taxable income and promoting financial well-being.
• Managing Rising Medical Costs: Shields you from the ever-increasing costs of medical treatments and hospitalisation.

How to Pick the Best Health Insurance Plan?

• Assess Coverage Needs: Choose a plan that covers hospitalisation, critical illnesses, and outpatient care. Evaluate if pre-existing conditions and post-hospitalisation expenses are included.
• Check Network Hospitals: A wide network ensures easy access to cashless treatment, reducing upfront costs during emergencies.
• Review Premium Costs: Balance affordability with comprehensive benefits. Opt for flexible premium payment options if available.
• Look for Add-Ons: Riders like maternity cover, personal accident cover, or wellness programs enhance your policy’s value.
• Claim Settlement Ratio: Higher ratios reflect an insurer’s reliability in processing claims efficiently.

How to Purchase Health Insurance Online

Compare Plans: Research various insurers, comparing coverage (hospitalization, pre/post-hospitalization), premiums, claim settlement ratios, and add-on benefits like maternity cover or critical illness coverage. Use aggregator platforms for side-by-side comparisons.

Check Eligibility: Assess age limits, pre-existing condition coverage, and waiting periods. Some plans exclude pre-existing illnesses initially, while others offer quicker coverage with higher premiums.

Fill Application Form: Provide accurate details on personal information, medical history, income, and nominee details. Errors can delay approval or cause claim rejection.

Upload Documents: Submit ID proof (Aadhaar, PAN), medical records (if required), income proof (for high coverage plans), and address proof. Insurers may request additional health check-ups.

Make Payment: Choose secure payment methods (net banking, UPI, credit card). Post-payment, you receive a digitally signed policy document instantly, valid for immediate use.

Health Insurance Scheme: PM-JAY

The Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (PM-JAY) is a landmark health insurance initiative by the Government of India, aiming to provide comprehensive health coverage to economically vulnerable sections of society. Launched in 2018, PM-JAY stands as the world's largest government-funded health assurance scheme, offering a coverage of ₹5 lakh per family per year for secondary and tertiary hospitalization expenses.

Key Features of PM-JAY:

• Extensive Coverage: The scheme targets over 12 crore poor and vulnerable families, approximately 55 crore beneficiaries, constituting the bottom 40% of the Indian population.
• Comprehensive Benefits: Beneficiaries are entitled to cashless and paperless access to healthcare services across public and private empanelled hospitals nationwide. The coverage includes expenses for hospitalization, surgeries, and treatments for critical illnesses.
• Recent Expansion: In September 2024, the Union Cabinet approved an expansion of PM-JAY to include all senior citizens aged 70 and above, irrespective of income. This move is set to benefit around 4.5 crore families, providing them with free health insurance coverage of up to ₹5 lakh per family.

PM-JAY's implementation is overseen by the National Health Authority (NHA), ensuring effective coordination between central and state governments. The scheme's primary objective is to alleviate the financial burden of medical expenses on vulnerable families, ensuring access to quality healthcare without the risk of impoverishment.

FAQs

Can I have multiple health insurance policies?
Yes, you can hold multiple health insurance policies simultaneously. During a claim, you can use the Contribution Clause to split expenses between insurers. Alternatively, you can claim from one policy first, and if the coverage is insufficient, the remaining amount can be claimed from another.

Do I need to undergo medical tests before buying health insurance?
Medical tests are required for applicants above a certain age or with pre-existing conditions. Tests help insurers assess your health status and decide premiums.

What is a 'waiting period' in a health insurance policy?
A waiting period is the duration after policy issuance during which specific illnesses or benefits are not covered. For example, maternity cover might have a waiting period of 2-4 years.

Can I add my family members to the health insurance policy to get the benefits?
Yes, family floater plans allow you to include family members under one policy, offering coverage for hospitalization, critical illnesses, and more, often at a lower premium than individual policies.

Can I claim health insurance more than once a year?
Yes, multiple claims are allowed within a policy year, as long as the cumulative claims do not exceed the total sum insured. Certain policies also offer reinstatement benefits, restoring the sum insured if it gets exhausted.

What is not covered by a health insurance policy?
Exclusions typically include cosmetic surgeries, dental treatments, self-inflicted injuries, and illnesses during the initial waiting period, among others. Check specific policy documents for a detailed list of exclusions.

Will smoking increase the cost of my health insurance?
Yes, smokers are categorized as high-risk due to associated health issues like lung disease and heart conditions, resulting in higher premiums compared to non-smokers.