We all know the very famous proverb “Health is Wealth”. In today’s world, health insurance helps us address the monetary aspect that is associated while taking care of our health. There are many health insurance policies, but it is important for us to buy the right health insurance policy.
First of all, we need to understand some of the pointers to be taken into consideration, before buying the right health insurance policy.
How does the policy treat pre-existing diseases?
There is usually a waiting period clause for pre-existing diseases that is included in all policies. The period can range from 1 to 4 years. The shorter the period, the better it is for you. After this period, all expenses associated with that condition will be reimbursed. You can also check if you can reduce the period by paying an extra premium.
Some policies offer a no claim bonus
The bonus here is that your cover gets a boost of around 5-10% for every year that you do not make a claim. Check how the premium amount will vary, between the policies that offer this benefit and those policies which do not offer this benefit.
3. Check the exclusions mentioned in the policy. The fewer the exclusions the better it is for you.
4. Some policies reimburse the cost of your annual health check-up after a certain number of continuous claim free years.Check if this service adds value in terms of the premium you are paying.
5. Check the maximum age upto which you can renew the policy.
Most policies offer a cover upto the age of 70 years. Others offer a cover upto 80 years and some policies offer a cover even upto 90 years. You will need insurance for your entire lifetime so anything below 75 years should be completely avoided.
6. Senior citizens will be expected to pay high premiums and there will also be a limit to the reimbursement claims.
Some of the advantages of health insurance are:
1.By paying an annual premium, you ensure that you and your family members receive quality medical service any time during the period of the policy.
2. You protect your savings from sudden medical expenses.
3. You can receive quality medical care anywhere in India, even if you do not know anyone at that location.
4. With a cashless plan you can actually plan your medical treatment with less stress.
5. You can also transfer your health insurance policy from one company to another, if you are not happy with the services being offered.
Some of the disadvantages of health insurance are:
1.Ensure that you buy a policy after checking out all the fine prints, so that you will be able to use it when you need it the most. Make sure that you are buying a policy that provides enough cover at a premium that you can afford. It doesn’t make sense to be paying for a policy that has too many limits and exclusions.
2. Ideally it should provide life time cover.
Individuals can claim tax benefits, if they have paid health insurance premiums for themselves, their spouse, their children and their parents. An individual can claim a deduction of Rs.15000/- under Sec 80 D for himself and his family, which includes his spouse and children. Also Rs.5000/- can be availed for preventive health check-ups.
You can further claim a deduction of Rs.15,000/- for your parents and if they are senior citizens then you can claim Rs.20,000/-.
Thus you can claim a maximum deduction of Rs.40,000/- for you and your family and in case both yours parents are senior citizens.
Most health insurance plans will have to be renewed annually, so you can avail of the above tax benefits annually. In case you opt for a plan that is valid for 2 years, then the tax benefit is available only for the 1st year.
The above are some important considerations to be kept in mind while buying the right insurance policy.
This post is in continuation to our previously featured post on The Importance of Health Insurance.
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