Family Floater or Individual Mediclaim – Which one to opt for?
Kulkarni wanted to buy a health insurance plan, when he called a couple of insurance guys he was asked the same question – Sir are you looking for Family Floater or an Individual Mediclaim policy? Are you also in the same dilemma?
All insurers offer two variations to its health insurance products – Family Floater and Individual mediclaim. But each of them has their pros and cons. So let’s quickly dive into what when and why of these two, so that it helps you in making a decision. Let’s get started –
Family Floater and Individual Mediclaim – The Difference
The difference lies in how the cover is provided, in the case of Family Floater Policy, all the family members are covered under one policy, whereas in Individual Mediclaim a separate policy is issued for each family member. Just for, e.g., –
Arun along with his wife and two children would have two options –
- Family Floater – Under this policy there exists a single floater sum assured that would be shared amongst his family members in case of any health emergencies.
- Individual Mediclaim – Under this policy each family member would have a dedicated sum assured and would only be used by that particular member.
Which is cheaper- Individual Health Cover or Family Floater?
Continuing with the same example above “Arun along with his wife and two children” let’s explore the money he needs to spend in case he opts for Family floater/Individual Mediclaim.
| Policy Type | Cover Required | # of People Covered | Premium To Be Paid |
| Family Floater | 400000 | 4 [ 2 adults + 2 children] | 11765 /- INR |
| Individual Mediclaim | 400000 [ For each member] | 1 | 16902 /- INR |
| 400000 [ For each member] | 1 | ||
| 400000 [ For each member] | 1 | ||
| 400000 [ For each member] | 1 |
Clearly, a family floater policy is cheaper! But the premium is not the only parameter to consider before buying a health insurance.
When is Individual Mediclaim better?
- When one of your family members has a history of health issues
- If your dependent children are of age more than 21 years
When is Family Floater better?
- If the family is young, i.e. the age of the father is about 30-35 years and for a couple without kids or with young kids
A Family Floater From Employer, Should You Still Go for Individual Mediclaim?
YES!
It is important to have an insurance cover independent of company benefits, for the following reasons
- You and your family members do have a history of serious illness
- The cover provided by the firm is not enough
- Exclusions from the company provided group health cover are high
- Company provided health cover is restricted to while one works with the same company only
- The ease of early entry in health insurance segment would help on the premium front and hence having an independent health cover earlier in life is better.
Which Policy is better?
Let’s take an example – Karan[46] along with his wife[42], dependent parents [68 and 72] and two children[15 & 19] are looking for a health insurance policy.
Here are some facts about the family –
- Karan is a High BP Patient
- Although family floater covers the dependent parents in some cases, it would be risky as with old age health needs shoot up
- Once his elder kid reaches 21, he would need to buy a separate cover for him without getting the benefits of no claim policies
In case they go for Family Floater
Say the family opts for 500000 covers with the floater policy; we see three people [Karan and his parents] in the family that may need health cover. Assuming his father and himself uses the cover in a particular year, the rest of the family is at high risk of bearing the health costs on their own.
In case they go for Individual Mediclaim
Say the family opts for individual mediclaim policies with each person having a minimum cover of 300000 each. Obviously, they would be paying the premium more but for their kids and wife it may remain untouched for years.
A Middle Path
Ideally, Karan should opt for individual mediclaim policies for his parents and could cover himself and his family with a family floater, those ways he could save on the premium as well and would also ensure that there is a dedicated cover for his parents.
Quick Guide To Decide
- List down what you need a basic cover [ just in case] or exclusive cover for someone having health issues.
- Recognize and choose the apt products based on your requirement.
- Try to group people who could be covered under floater scheme and exclude people from floater scheme who have health concerns.
- Take care to opt for a sufficiently high sum assured as multiple family members are covered under the policy.
- Purchase an individual cover for members who need health assistance.
Following this approach, you can not only save on premium but also make sure to provide extra cushioning to people who need health assistance at regular intervals.
We hope we have answered your queries which policy fits your family – individual mediclaim or family floater. If you still have any unanswered questions or need help, feel free to contact us.
We would be glad to help you with your planning and investment related decisions.
– Samiksha Seth
Content Strategist Dilzer Consultants Pvt Ltd.
Sources
9 Sep 2016