Take care of your health

In these times of uncertainty,it's advisable to take a simple but wise step of buying a personal health insurance policy over and above what the employer has provided,says Ritu Kant Ojha

Written by Ritu Kant Ojha | Published: July 2, 2012 1:56 am

Aman Kaushal,35,is a troubled man these days. Till recently he worked with an IT company in Noida. But suddenly one day,his boss told him that as outsourcing slowed down significantly due to slowdown in the US,the company was forced to cut down on staff and Aman was one of them.

Another setback was awaiting him. Since he and his family were covered by his company under a group health insurance policy,Aman never bothered to buy a personal health policy. Few days back,his wife met with an accident and had to be hospitalised for a week for a minor surgery. He was shocked to see the hospital bill after his wife’s discharge. It was a whopping R four lakh bill. Aman had to use his entire EPF corpus earned in the last seven years of job. This double whammy has put Aman into a depression.

He ‘failed’ to plan

There’s an old saying,“failing to plan is planning to fail.” While Aman put the entire blame of both losing his job and not having a health insurance cover on his “bad luck,” his is a classic case of failing to plan. If you look around and ask a question to your relatives and colleagues in office,you will be surprised to know that there might not be many who have taken this simple but wise step of buying a personal health insurance policy over and above what the employer has provided.

“In India,the estimate of the number of employees who also opt for personal health insurance,would be less than 3 per cent overall with a majority of them doing so to avail of the associated tax benefits,” says KK Mishra,executive vice president,Tata AIG General Insurance.

Whether you are in a job or are an entrepreneur,there is an overall economic ecosystem within which you work. The economy in India is going through a tough phase with clear signals of a slowdown. While the reasons,ramifications and results of this slowdown can be debated by experts,those in job have already started feeling the heat regardless of the sector they belong to.

At the end of the day,the balance sheet is what concerns most to a company. So,losing a job during a slowdown is something that you can’t rule out. What do you do in such a situation?

A successful financial plan rests on successfully covering various risks. While life insurance is addressed by most people even at the expense of being under-insured,health insurance is mostly given a miss. With current modern lifestyles,susceptibility to health risks in general and some critical illnesses in particular have increased more than ever before. Some of these risks can often bring in unforeseen hospitalisation causing a financial burden on the individual and his/ her family. With escalating medical costs,charges like surgeon’s fees,diagnostic tests etc may turn out to be very expensive. It is then that the importance of health insurance comes into the picture. Health insurance provides the ability to afford better healthcare facilities for the family.

How will you choose?

According to experts,the employers typically buy indemnity-based products. This means that the policy pays only for the expenses incurred. But the health contingency is not limited to meeting the hospitalisation expenses alone. They can also lead to temporary or total loss of employment and loss of leaves. In addition,there are hospitalisation-associated expenses which are not covered by standard health policies. There’re several options available in the market these days wherein the health policies offer several benefits which include cashless hospitalisation,critical illness cover,special covers for senior citizens,disability benefits etc .

“To cover the additional expenses,it makes sense to take hospital cash policy. These policies provide defined daily cash benefits based on the number of days of hospitalisation. This can also provide the cash benefit in lieu of the leaves taken on account of hospitalisation,” says Mukesh Kumar,Head-Strategy Planning,Marketing and HR,HDFC ERGO General Insurance.

You might also get confused between buying an individual or a family floater policy. “A family floater offers a common coverage for all members in the family. Such a policy is beneficial when the family comprise both young and old members,” Mishra said.

In a family floater policy,a single sum is shared amongst all members insured in the family. This is in contrast to the individual policy where the sum insured is available for the individual policyholder and hence can be utilised to the fullest by the insured member. “A family of three wants to take health insurance,depending on the ages of individual members,the family floater plan for Rs 4 lakh is likely to be cheaper than the three individual policies of Rs 2 lakh each.,” Neeraj Basur,CFO,Max Bupa Health Insurance said.

Experts advise to buy a health insurance policy early in life. This will ensure that on continuous renewals,the policy holder is protected for any illness that he or she might develop in later stages. Buying a health insurance policy at a later stage when the individual already has a pre-existing condition could lead to exclusion of existing health condition from the coverage for up to four years.

Post four continuous renewals,it will be covered.

In these times of slowdown,companies are resorting to various cost-cutting measures like putting caps on various facilities under a company-provided health cover. Don’t be surprised if at the time of need you come to know that there are several limitations related to sum insured,family definitions (cover restricted to limited number of family members),co-payment clauses, compulsory deductibles,room rent and ICU limits. So don’t wait,buy an adequate health cover for yourself and your family today itself.

— ritukant.ojha@expressindia.com

FOR A HAPPY LIFE

* Health insurance coverage could include an indemnity health plan with a top-up like a critical illness plan

* Family floater offers flexibility and economy in terms of utilising the overall insurance coverage among the group

* Buy a health policy early in life. This will ensure that on continuous renewals,you are protected for any illness that might develop in later stages.

* Other benefits include cashless hospitalisation,critical illness,special covers for senior citizens,and disability.

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