Health insurance: Don’t miss it

Health is wealth. That’s old wisdom. In todays scenario its corollary hold true. If you lose your health, your treatment can be a major drain on your resources and leave you financially crippled.

And given that healthcare costs are rising at more than 15 percent annually, one should try to guard against such a hit. Health insurance should no longer be a matter of choice, but a necessity in view of the escalating cost of medical treatment.

In India, general insurance companies sell stand alone health policies, though life insurance companies are beginning to offer these too. In the past, they covered hospitalization costs, but now private insurers offer products that also pay pre and post hospitalization expenses.

These policies have become much more convenient than in the past with the advent of cashless transactions. Also, large hospitals chains now have tie-ups with companies which help policy-holders get free outpatients visits to the consultants in their hospitals, besides cashless claims.

One can also get cover for critical illness under riders that come with life covers from life insurance companies.

However, given a variety of offerings, it is wise to first define your needs. One way of doing so is to identify medical emergencies that could hit your family.

Examine policy benefits and coverage: It is important to realize that not all medical expenses are covered by the products available. For instance, many medical policies do not cover dental procedures, non-surgical care, or consultation.

Also, the cover is available till a certain age. And once used, critical illness riders that come with life cover cease to exist.

Determine your affordability: After figuring out the product that will give the best possible cover and benefits, one has to get a fix on the premium he can afford.

Health covers from general insurers and critical illness riders from life insurance companies are entitled to tax deduction under section 80D of Income Tax Act.

Be an early bird: It pays to start early when it comes to buying health insurance. If one procrastinates, diseases suffer later in life and remain out of policy coverage due to existence of the clause of pre-existing diseases. Though, off late there have been products where pre-existing diseases are being covered but subject to specific conditions.

One also gets the benefit of no-claims bonus if no claims are made, and this adds to 15 percent of the cover every claim-free year.

Moreover, even if one is covered for medical insurance from his employer, its wise to get a separate cover also. A change of job could leave one without cover, as could retirement. And getting fresh cover after 45 is difficult and costly.