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Thursday, Nov 12, 2015

Beyond finance: Check if you really need high-value health cover

[Source : The Economic Times]

A health insurance floater policy of Rs 5 lakh was considered adequate till recently. However, rising healthcare costs are pushing individuals to opt for higher covers. Cashing in on the trend, some companies are now offering Rs 50 lakh, and even Rs 1 crore covers. Not surprisingly, the premiums are steep. An individual health cover of Rs 50 lakh for a 30-year-old would cost Rs 20,000-60,000 a year. A family floater of a similar sum insured would cost Rs 40,000-50,000 if the oldest family member is 30-35 yearsold.


Divya Gandhi, principal officer and head of general insurance, Emkay insurance Brokers, says a Rs 20-25 lakh policy is sufficient even if you plan to get treated in the best of hospitals in metros. The biggest advantage of high value covers is that international treatment is compensated. However, the list of ailments covered is restrictive. These policies also have a higher co-payment clause for senior citizens at 20 per cent. According to certified financial planner Abhinav Gulechha, the year-onyear premium cost does not justify the coverage provided.


Gulechha suggests buying an indemnity plan of up to Rs 5 lakh and increasing it as and when your requirement or responsibilities increase by way of a top- up policy. Assuming you may still consider going overseas for a specialised treatment, you could buy a fixed benefit policy like for critical illness, in combination with the regular hospitalisation cover. You could also buy a high-sum insured critical illness plan and get the entire sum insured as lump sum. High-value covers are beneficial if you are looking to cover your family.

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