We all know health is wealth.
Not paying attention to health keeps one at risk of falling ill. You can’t reap the wonderful rewards of your hard work if you’re lying in bed, sick all day.
Moreover: hospital bills are expensive. Depending on the illness, medication and treatment are expensive. Most people can only afford to fall sick a few times a year.
While our bodies may be robust enough to withstand basic illnesses or a common cold, it’s hard to predict the life changing impact of a chronic illness.
Most of us are very optimistic towards our health, which makes most us ill prepared for a serious health issue.
For example, a recent study showed that bidi smokers in India alone spent approximately Rs. 80,550 crore on tackling health issues.
Though most of us have some basic health insurance coverage at work, this is not enough to cover most illnesses.
So how do we prepare for such situations?
The answer is simple: health insurance. Not only does health insurance ensure that one can breathe a little easier in the event of a major health expense, but it also helps you bump up your savings by a significant amount. Here’s how:
Start With the Basics
Health issues like heart disease and diabetes are common amongst Indians, which means medical emergencies are common, especially in old age.
In case of a medical emergency, in addition to the hospital bills, there are also some pre and post hospitalization charges that one has to incur.
In addition, while looking to get the best possible health insurance, it is also a good idea to get your family insured as well.
There are a plethora of basic health insurance plans that cover not only these hospital bills, but also the pre and post hospital charges and the health expenses of your family members as well.
Getting this basic coverage makes things much easier in the long run.
In the event that the subscriber or one of their family members is hospitalized, bills will be the last thing they will have to worry about.
In addition, to these basic policies, If someone in your family or yourself is already suffering from an illness, there are specialized critical illness policies which you can use to prepare for the worst.
How Can You Save On Tax?
Under Section 80D of the Income Tax Act, 1961, the government gives citizens the provision of a tax exemption if they have applied for health insurance.
This is one of the biggest advantages of availing health insurance. As for the numbers, if you have paid a premium on self, spouse and a child in one financial year, you can claim up to ₹25,000 in tax breaks.
In addition, if you have paid an extra premium amount for your parents, you can claim an extra ₹25,000 to ₹30,000 in tax breaks, depending on the age of parents.
In addition to the tax break, you can get by paying the life insurance premium, you can also avail tax exemptions under Section 80DD and Section 80DDB, for any expenses incurred by you for their medical treatment which includes nursing, training, as well as rehabilitation of dependents who are disabled.
However, it is mandatory to get a medical certificate from a government hospital in order to claim the deduction.
What if I Don’t Fall Sick?
That’s a good question. For example, if you pay a ₹25,000 premium in a particular year for health insurance, and you don’t claim any insurance that year, that’s a loss of premium.
Fortunately, most insurance plans have schemes to ensure that people who stay healthy are adequately rewarded. These are called no-claim bonuses.
No claim bonuses ensure that the base insurance coverage is increased by a certain amount every time you have a claim-free year.
For example, under the health insurance coverage offered by Reliance General Insurance, you can get a 33.3% increase in base insurance coverage for every claim-free year.
How to Choose the Right Insurance Plan?
It depends on two basic parametres
1.How Much Cover Do You Need?
The first thing you need to do while choosing the right health insurance plan is to estimate how much coverage you actually need.
This can vary depending on where you live, your family’s medical history etc. For example, if you live in a metro city, your cost of living will be much higher and hence you would want to avail an insurance plan that suits your lifestyle.
In metro cities this can be as high as ₹10 lakh.
2. What is the Sub-Limit?
The second thing you’d want to keep in mind is the sub-limit. A sub-limit refers to a spending cap on individual bills.
So, irrespective of the amount you’re insured for, you still end up paying out of pocket expenses during hospitalization.
Some plans do not have sub-limits but a lot of plans do, so, depending on your medical situation and the spending cap per visit, you can choose to avail of a plan that doesn’t have sub-limits.
3. Is There a Coverage for Pre-Existing Ailments?
Thirdly, in case you have any pre-existing ailments, it is also very important to check when the coverage for those ailments start, as per your chosen insurance program.
Most insurance programs start coverage for pre-existing ailments from around the 48-month mark.
There are certain insurance programs that cover the same, from 36 months onwards as well. But irrespective of the plan, it is important to disclose any pre-existing ailments when you sign up for the plan, for a smooth claim settlement process.
With good insurance policies in the market out like Apollo Munich Easy Health, ICICI Lombard Complete Health Insurance, Religare Health Insurance Care, Bajaj Allianz Health Guard, and Max Bupa Health Insurance Health Companion Plan, there are plenty out there to secure both your health and your wealth.
So be wise, be healthy!
Disclaimer: The views expressed in this post are that of the author and not those of Groww