HEALTHCARE MADE EASY: Navigating Health Insurance and it’s Importance!

We live in an era of expanding services and the healthcare industry is improving a little almost every day, and the prices for even the most basic services are skyrocketing! But now, why is this happening? The most probable cause for this sudden need to improve drastically within the medical parameters would be the gradual increase in health risks that were either unknown to humans and have emerged only recently or those that were dormant and have erupted unusually in the last few years.

Take COVID-19 for an example, nobody in their wildest imaginations would have contemplated the rise of the 2020 pandemic that wreaked havoc in the lives of so many families. This is exactly where health insurance needs to step in, while medical and health care bills are more than capable of burning a hole in your pocket; health insurance will be your best friend in dealing with such situations! It is essential to understand the whys and hows of health insurance even more now, and with the growing need to be financially prepared for the worst!

Let’s discuss everything that you must know about health insurance in 2024!

WHAT EXACTLY IS HEALTH INSURANCE?

You will often come across a lot of individuals advising you to not waste money on these insurances and just save money instead for your future, but in case of a medical emergency, being prepared is going to save you from a lot of trouble! 

Health insurance is a policy offering assurance of financial stability and immediate help when you are confronted with a medical emergency out of nowhere. It could be of any nature- it could be an illness, a severe injury, or an unfortunate accident- but if you opt for financial stability with health insurance, you are protected from huge hospital bills all the time! But wait! How does it work? It is pretty straightforward once you try to understand it- an insurance policy is framed between two parties, the insurance company and the policyholder. All the medical expenses are borne by the insurance company up to the sum insured against a premium paid by the insured person. Whenever you purchase a health plan, the insurance company is bound by an agreement to provide you with immediate financial compensation in specific medical emergencies. The terms of the contract vary for every health plan and could also include financial compensation for frequent and routine health checkups and hospitalization fees.

Insurance companies are associated with some specific healthcare providers and hospitals for providing medical treatments to the policyholders. If you visit an associated branch, you will be entitled to perks and benefits as per the policy terms. We all can agree here that health insurance is extremely important now more than ever and for someone who is dedicated to taking care of their family and loved ones, it is likely to be fruitful on more than one occasion.

WHY HEALTH INSURANCE? THE IMPORTANCE OF GOOD HEALTH PLAN! 

It is frightening to imagine a medical emergency happening to the people you love and cherish dearly and regardless of your age and social status and this is just how life works for all of us. We all know that life can be pretty unpredictable at times and which is exactly why you need to be familiar with the best health insurance policies out there.

Let’s dive further into why exactly health insurance is going to be beneficial for you!

• To deal better with lifestyle diseases: lifestyle changes are proving to be more harmful as people at younger ages are being confronted by medical conditions that can be potentially harmful and even life-threatening if not observed closely like diabetes and asthma. Escalated pollution levels, unhealthy eating habits, and encountering excess stress at work are some of the major factors that bring in negative lifestyle changes that result in unexpected medical complications.

There is an active need for health insurance in these progressing times when our bodies are more exposed to health risks, and while taking precautionary measures is a key takeaway from these situations- health insurance provides you financial incubation from the more dangerous impacts of these diseases.

• Protecting family and loved ones, Our families are our priority,no matter what and this emotional connection with the people you love and adore is beneficial for them in more than one way. While selecting a health insurance policy, the needs of your family members are most likely to be your priority, especially for families that consist of senior citizens and children or anyone financially dependent. For someone who is providing for the entire family, the burden of being the only income source is huge!
• Health insurance policies are personally catered to your needs and requirements and are designed to give you the best results. For example, if you have parents who are aging and fragile, they are more likely to come in contact with diseases and require urgent medical supervision.

Diving into health insurance in the earlier stages can be beneficial as it gives you time to plan, contemplate, and ensure the future of your loved ones.

• Inflation and rising medical expenses: inflation has not spared the healthcare industry and impacted it even more, if possible, with rising medical expenses and increasing cost of general treatments, health insurance has become a must-have for everybody. In such emergency cases, it is vital to have health insurance catering specifically to your needs to save you from burning a hole in your pocket. Special insurance policies like critical illness insurance and personal accident insurance are going to be life savers in times of need.
• Safeguarding your savings:  Due to sudden medical emergencies, you might find yourself in extreme financial distress and uncertainty, health insurance saves you from the extra stress of burning through your savings and prevents you from entering into debt. Health insurance policies give you breathing space to collect yourself mentally and safeguard your savings that might be accumulated for a better purpose.

When equipped with a good health plan, you can focus on recovery instead of money, your finances are managed and taken care of by the insurance company which allows you to spend more time with your family in peace. Health insurance is going to safeguard you from financial burden and make sure your savings are reserved for your ambitions and aspirations rather than sudden medical bills.

FEATURES OF A GOOD HEALTH PLAN

Different insurance companies offer various features on their insurance policies and some even offer extra perks and benefits than others, which is why it is essential to understand some common features of a good health plan.

Let’s discuss these features more closely and understand them!

1.     Premium: every insurance company has a different premium amount set for their plans; a premium is a set amount that the policyholder pays yearly against the coverage that is being provided by the insurance company. Premium varied in accordance with the age and sum assured as well.
2.     Exclusions: some insurance plans contain certain specific clauses related to exclusions of the policy. These exclusions refer to certain stated medical conditions and treatments that are not covered by health insurance . Please read these clauses carefully while purchasing a health plan to avoid repercussions in the future that might be upsetting and shocking. Note:  premium varies in accordance with the age and sum assured.

For example, most of the insurance companies consider diseases like cataract as an exclusion for a certain specified period, as the disease is not life-threatening!

3.     No-claim bonuses: just like other insurances, when health insurance is not claimed in a specific year, the insurance company pays you a no-claim bonus with a greater insured amount against the constant premium amount that you have been paying earlier. This is beneficial as you get higher coverage against the same premium and you should always keep in mind to examine the no-claim policy before purchasing a health plan. For example- suppose you have purchased health insurance for coverage of 2 Lakhs against a premium of 10,000 annually. Every year that goes without a claim is rewarded with a 5% renewal premium decrease from the insurance company. This is known as the “no claim bonus.”and the sum assured is increased. If you do not claim the insurance- in that case the sum insured in the next year will be increased to 220000!
4.     Network hospitals: many insurance companies provide cashless payment facilities included in the health plan in specific network hospitals that are tied to the health plan. The larger the network of hospitals, the easier it will be to have cashless treatment! If your health plan has only a small network of hospitals listed in it you might have to pay them at your own expense though you can get it reimbursed afterwards. Hence, always keep this in mind while choosing a suitable health plan.
5.     SUB-LIMITS: another very costly area while dealing with medical expenses is the room rent or hospitalization fees that are charged by the hospitals while admitting patients, the room rent is mostly tied to the sum insured. Generally, it is around 1-2% of the sum insured and you must inspect this section carefully to ensure you are satisfied with it.
6.     Policy coverage: This underlines the maximum amount of expenses that you can incur which will be compensated by the insurance company or paid directly to the hospital. Once your expenses exceed the amount of the sum insured you will be liable to pay from your pocket. Making sure that you have chosen the right sum insured is very important.

WHAT IS THE RIGHT HEALTH INSURANCE FOR YOU?

By now, you are all the more familiar with the term: health insurance, and the need for it in the present. Moving forward, now you should know about how you should select the right health plan for your needs and preferences and why choosing the right plan is essential for your journey towards financial stability. Selecting the most suitable health insurance policy will play an important role in determining your health and finances and everything else that it will impact!

Here is exactly how you can choose the right insurance policy for you:

EVALUATING YOUR NEEDS AND REQUIREMENTS

Before choosing your health plan, you must know about your personal needs and requirements and align them with your family’s needs to ensure you pick a plan that benefits all of the people who are near and dear to you!

• Genetic or hereditary health problems: if your family has a history of genetic and hereditary health problems, you should look for a plan with broader coverage.
• Lifestyle habits: for people who lead a high-risk lifestyle or a job that requires them to take additional risks, insurance policies with accident coverages are advisable.
• Existing finances: you need to evaluate your existing finances and your financial situation before getting into health insurance, as premiums can range from INR 5000 to INR 20,000 as well for basic coverage.

CONSIDER YOUR OPTIONS

Before investing in a health plan, you must be familiar with all your options and carefully consider them to make an informed and firm decision that aligns with your requirements.

• Individual plans are ideal for those individuals who are looking for single coverage. individual health plan is for a single individual and is used to get financial coverage for medical expenses like accidents, illnesses, emergencies, and hospitalization
• Family floater options are those insurance options that cover the entire family under one policy. Instead of purchasing health insurance for every individual member of your family separately, you can purchase one policy that will benefit them all. Anyone from your family can use the coverage amount when they fall sick or need medical assistance in an emergency.
• Critical illness insurance provides a lump sum on diagnosing specific critical diseases such as cancer; which have high treatment and diagnosis costs.

COMPARE THE BENEFITS

As a final step, you should compare all the plans that cater to your needs and decide which one fits your needs and requirements the best, this process is extremely crucial to selecting the right health insurance for you and your family and should be performed with utmost careful planning. Go through all the plans that appeal to you and note down key takeaways from them, evaluate which plans offer you the most benefits of all.

ON A PARTING NOTE

You cannot predict the future for sure, but you can safeguard it! nobody knows what is likely to happen next and how it will affect you and your loved ones, being prepared will take you a long way. Inflation is affecting the healthcare industry and even the simplest of medical treatments will cost you a huge amount and  health insurance is likely to be your go-to option for securing your family’s medical future saving them from financial distress! Where even a simple medical procedure can cost you lakhs of rupees, choose a health plan that will relieve you of financial burden.

It is no longer an option, it is more of a necessity! 

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Disclaimer – This article is for educational purposes only and by no means intends to substitute expert guidance. Mutual fund investments are subject to market risks. Please read the offer document carefully before investing.