Dilzer Consultants - Investments and Financial Planning

An ISO 9001 (2008) Certified Company

   SEBI REGISTERED INVESTMENT ADVISOR

Health Insurance

Health insurance provides risk coverage against expenditure caused by unforeseen medical emergencies.

In current times of high medical inflation, (inflation on medical expenses is between 20-30% per annum) failing to hold adequate amount of health insurance cover can lead to a disaster. This could lead to either poor health care because of non-affordability of proper insurance or put a person into financial distress due to exorbitant medical bills.

Most of the salaried professionals are being covered by health insurance through their employers,and they are fully dependant on such health insurance covers to take care of their medical contingencies for themselves and their families. We caution against this! In many a case the company provided health insurance is not enough to take care of one’s health needs. Moreover, the employee is dependent on company health cover benefits to protect their families. What if they leave the company tomorrow? What if, the company rules provide for restricted coverage or have many exclusions due to group health insurance? People often fail to understand or assess their health insurance requirements and rising costs of medical inflation today. 

 

Rising Health care expenses and hence the need of Health Insurance

 

  • Estimates suggest that medical inflation has been in double digits since more than one decade.
  • Generally speaking, diseases like cancers, cardiovascular ailments, chronic respiratory ailments and diabetes are some of the major causes of deaths in India. And fighting these diseases is getting expensive.
  • The medical care is becoming less invasive and more costly due to new technology. With healthcare providers putting in crores of rupees in super-specialty equipment and robotics, the cost is obviously passed on to patients.
  • Diagnosis of a disease at any point of time can lead to sudden panic. The major reason behind this panic is generally the high cost involved for medical and treatment for certain ailments or even injuries

 

Expectations from a health cover- What to look out for?

  • Reimbursement – Are hospitalization and related expenses paid for?
  • Cashless facility at most Hospitals- Is this covered?
  • Tax benefits: Most registered Health Insurance providers provide tax benefits Under Sec 80D of the Income tax act, where the premium paid up to Rs 25000 per annum is deductible from your taxable income over and above other tax deduction benefits under Sec 80C.
  • Assured renewability of policy throughout your life: New insurers are covering health insurance hospitilisation benefits till 100 years of age!
  • Maternity and Child Care Benefits: Few insurers cover this. It is important for this to be covered especially if the family is young and just married.
  • Incidental Expenses – have the necessary spare cash to take care of incidental expenses and income replacement
  • Critical illness – reduce the financial burden if diagnosed with a major illness
  • No unnecessary loadings in claims due to previous claims made.
  • Minimum exclusion and minimum waiting period for pre existing illness
  • Free Look period: It is important to get a refund for your money if you are unhappy with the policy terms and conditions. Most companies offer a refund through a free look period of 15 days from the date of issue of the policy.
  • Comprehensive coverage: This should ensure day care procedures are also covered and no minimum period of hospitalization is required to make claims.
  • Free Health Check up: This is a good indicator of your health condition and a preventive way to plan for emergencies.
  • Long-term care – assurance of coverage when its needed the most
  • Convenience – ease in claims with minimal formalities.
  • Transparency – no hidden clauses and terms of coverage to avoid any shock during claims.
  • Direct Settlement of Claims: NO Third Party Administrator.
  • Percentage coverage on hospitalization benefits: Without any sub limits on the procedures and expenses.
  • Accidents and Emergencies Covered from day 1
  • Exclusions of the policy terms.
  • Pre-existing illness’s and waiting periods. Different insurers have different waiting periods.
  • Portability of your insurance cover to another company with benefits. This is an important point to check.
  • Reinstatement of sum insured during the same year.

An ideal health plan needs to cover not only hospitalization expenses like room charges, doctors fees etc but also costs related to  surgical procedures and incidental expenditure.

Process flow chart of Vidal Health (Third Party Administrator)

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