What Type of Health Insurance Do I Need?

Many countries offer free state-run healthcare to residents. However, given our large population and financial capacity as a developing nation, this benefit is available only to the poorest Indians, under the Ayushman Bharat Yojana scheme. This has left many in the dangerous situation of being completely without health insurance. A NITI Aayog study, Health Insurance for India’s Missing Middle, released in 2021, states that 42 crore Indians (or 30% of the population) are without access to any form of health insurance as they aren’t covered by the government or an employer. 

If you are among them, you’ve made a very wise decision in choosing to read this article. Here’s a look at the different types of health insurance available, so you can find the one that suits you best.

What is Health Insurance?

Health insurance is a type of insurance that pays for medical or surgical expenses and it’s often referred to as private medical insurance. Similar to other insurance packages, there are lots of different types of health insurance that provide you with different levels of coverage depending on your circumstances and what you pay. But typically, health insurance can help you get diagnosed faster and treated quicker, giving you more choice on when and where you receive treatment.

Choosing the Best Health Insurance

The best health insurance for you depends on what you are likely to use it for. It’s important to note that it typically doesn’t cover pre-existing conditions, so if your family has a history of certain illnesses it’s wise to take out health insurance early. There are also some drugs and treatments that you can’t get through public healthcare, such as specialist surgery for sports-related injuries. Here are some things to consider before reaching out to insurance providers.

1. What Do You Need Cover For?

Consider whether there are any specific types of cover you may need in the future. For example, some policies exclude certain treatments such as cataract surgery, maternal, dental care or cover for physiotherapy or injuries from extreme sports. These aren’t often included in basic packages, so you’ll need to specify them to a provider or look for one that is comprehensive. 

2. Who Do You Need to Cover?

Decide who needs cover under your policy, as you can take out health insurance for yourself, for you and your partner, or for your whole family. Sharing a policy might be more cost-effective and make life easier, as you’ll only have a single provider, one policy and a single point of contact that your whole family can use. Also, do factor in that while your spouse or child may not appear to need insurance today, you never can predict the need for such a product and it is also easier to get the right cover when you’re younger.

3. How Much Does it Cost?

There are lots of factors that influence the cost of your health insurance. These include your age, your habits, your location, and the types and level of cover you need. The two main costs associated with a policy are the premium, which is how much you pay each year, and the caps on expenses (particularly room rent) when you make a claim. Generally, the higher the excess, the cheaper your premiums, and your premium will often come down when you don’t make a claim.

Pre-existing and chronic conditions, such as diabetes or asthma, aren’t usually covered, as well as cosmetic surgery, organ transplants, normal pregnancy and childbirth, and injuries from dangerous sports. This doesn’t mean you can’t take out health insurance, it just means you won’t be covered for expenses related to these conditions.

4. How Much Cover Do I Need?

The amount of health cover you need depends on a variety of things, such as your age, health condition, the cost of care in your area and hereditary factors, too. As there are so many influencing factors, a wise decision is to purchase a large cover for many members of your family as part of one plan. For example, instead of purchasing health cover worth Rs. 3 lakh for 4 members, you could purchase a cover of Rs.12 lakh for the entire family. This works out more expensive, as the premium will be calculated based on the age of the oldest person in the group, but it makes a larger cover available to all four members of the family at all times.

What To Do if You Have a Chronic Condition

If you already have a chronic condition and can’t find suitable private health insurance as a result, you do have other options. You could become part of a group insurance plan. For example, you could enroll in Social Health Insurance (SHI) schemes such as the Employee State Insurance Scheme (ESIS) run by Employee State Insurance Corporation (ESIC) or those provided by government banks. Finally, there are social organizations that offer free advice, subsidized care and, often, even financial support to people suffering from long-term illnesses.