According to recent reports, healthcare inflation is growing two times faster than overall inflation. Due to this, people across all age groups have started realising the importance of purchasing health insurance.
In India, most health insurance buyers prefer buying a family floater plan as it covers all the family members under a single plan. It is an excellent way to extend health insurance coverage to all family members. Everyone covered under the policy can use the policy benefits.
While the family floater is an ideal choice for people in their late 30s, 40s, and 50s, youngsters in their 20s, unmarried, prefer buying an individual health insurance policy. But what is individual health insurance? How do they work? What are its benefits? In this write-up, we discuss the answers to these fundamental questions.
What is an individual or single health insurance policy?
As the name suggests, individual health insurance plans provide coverage to one person. It is usually the policy buyer. In an individual healthcare policy, there is a fixed sum assured, and the insurance company will cover the healthcare costs of the policyholder until they exhaust the full coverage amount.
An individual health insurance policy premium is lower than the family floater plan. However, it may vary based on several factors like age, gender, family health history, current health status, location, sum assured, etc.
How does an individual health insurance policy work?
When you buy an individual health insurance policy, you enter into a contract with the insurance company. You agree to pay a specific sum (i.e. premium) for a particular period to the insurer. In return, you get coverage for all your healthcare expenses to the extent of the sum assured and as per the policy terms and conditions.
Benefits of buying individual health insurance
High sum assured
You have the flexibility to choose the sum assured to suit your specific needs. You can buy a plan with a high sum assured up to ₹50 lakhs. And since you will use the amount alone, you may never fall short of coverage, and you can be assured that your healthcare expenses are always taken care of.
Pre-hospitalisation and post-hospitalisation
Generally, all individual health insurance plans cover pre-hospitalisation and post-hospitalisation expenses for 30 and 90 days, respectively. However, the coverage duration may change based on the policy you buy and its terms and conditions.
Cumulative bonus benefits
All insurance companies encourage health insurance policyholders to maintain a healthy lifestyle and reward them with a cumulative bonus for a claim-free year. If you do not file for a single claim in a policy year, you can earn up to 10% increase in the sum assured upon policy renewal year.
In some cases, the bonus offered is in the form of a discount on the premium, even as the sum assured remains the same.
Riders
All health insurance plans have certain limitations and exclusions. For example, some plans may not cover cancer treatment. However, this does not mean you cannot get coverage against it.
You can cover the expenses by buying an additional rider or add-on policy by paying an extra premium. Riders are the most cost-effective way to extend your standard policy’s coverage and get protection against specific risks that are not covered under your policy.
Some of the common riders you might want to consider buying are critical illness rider, accidental death benefit rider, maternity benefits riders, etc.
Final Word
Now that you know what individual health insurance is and its benefits, ensure that you purchase a policy at the earliest and get protection against medical risks.
