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Understanding Your Health Insurance Policy: A Beginner’s Guide

How Does Health Insurance Work?

A contract for health insurance is made between a person (the insured) and an insurance provider (the insurer). The insurer receives a premium from the person and pays the insured person’s medical costs incurred as a result of an illness or injury. Depending on the terms of the policy, health insurance may pay for pre- and post-hospitalization costs, ambulance fees, and other medical expenses.

Health Insurance Policy Types

Health insurance policies come in a variety of forms in India. These are the most typical sorts of policies:

  • Individual health insurance: As the name implies, only one person is covered by this coverage. A family floater policy often has a higher premium than an individual policy.
  • Family floater health insurance: This plan offers comprehensive coverage for the whole family under a single plan. Any family member covered by the policy is eligible to use the sum assured. Family floater policies typically cost more than solo ones.
  • Group health insurance: Group health insurance is a benefit that employers provide to their staff members. Typically, the employer is responsible for paying the insurance premium.
  • Senior health insurance: This plan has been created especially for older people. Due to the increased healthcare risks that come with ageing, the premium for this coverage is typically more than for a standard policy.

Health Insurance’s Advantages

There are various advantages to having health insurance, including:

  • Financial protection: Health insurance protects consumers financially from unplanned medical costs, easing the financial load on the insured and their families.
  • Cashless hospitalisation: Many health insurance plans provide this benefit, allowing the insured to get medical care without having to pay upfront.
  • Tax advantages: Section 80D of the Income Tax Act allows for tax deductions for health insurance premiums paid.**
  • Peace of mind: Knowing that one’s family and one’s self are covered in the event of a medical emergency gives people with health insurance peace of mind.

How to Pick the Best Health Insurance Plan

Given the plethora of options on the market, selecting the best health insurance plan can be challenging. Here are a few things to consider while selecting a policy:

Coverage amount: The health insurance coverage should provide enough money to pay for the insured and their family’s medical costs.

Network hospitals: Opt for coverage that offers a sizable network of hospitals for inpatient cashless care.

Premium: Examine various policies’ premiums to select a reasonably priced one that offers sufficient coverage.

Exclusions: Carefully read the policy paperwork to comprehend the policy’s exclusions and restrictions.

Having health insurance can give people and their families peace of mind in light of the COVID-19 pandemic and rising healthcare expenditures. Individuals may ensure they have appropriate financial protection against medical costs by comprehending the fundamentals of health insurance, picking the best policy, and considering the benefits it offers.

A health insurance premium calculator is a tool you may use online to determine the amount of coverage required based on your needs.

** Tax benefit is subject to change in prevalent tax laws.

Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.


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