Types of Health Insurance Plans in India

What are the Different Types of Health Insurance Plans in India?

Take a look at the various types of health insurance policies in India below:

Types of Health Insurance in Detail:

1. Individual Health Insurance

   Individual health insurance is meant for an individual only. It covers the incurred medical and hospitalisation expenses of the single person covered in the policy up to the sum insured limit.

   In case of more than one family member, each covered member gets an individual sum insured. For instance, if you own an individual health cover of ₹1 lakh where your spouse is also covered, you both can claim up to ₹1 lakh individually.

2. Family Floater Health Insurance

   A family floater health insurance policy is meant for the entire family. You can cover the medical expenses of your complete family under a single policy. The sum insured is shared by all the family members on a floater basis. One positive thing about this type of health plan is that the premiums are comparatively lower than individual or mediclaim policies.

3. Senior Citizens Health Insurance

   Senior citizens health insurance plans are designed to cover the healthcare expenses of elderly people above 60 years. It focuses on the health needs of senior citizens and may not require a pre-medical screening before buying the policy. However, the premiums of a senior citizens health policy are high as elderly people are more vulnerable to various age-related health issues.

4. Critical Illness Insurance

   A critical illness Insurance plan is designed to cover the treatment cost of critical illnesses, such as heart attack, cancer, liver failure, stroke, etc. On the detection of a listed critical illness, the insurer pays the sum insured amount to the policyholder, irrespective of the actual medical expenses.

   Unlike other health plans, it does not require you to get hospitalized to raise a claim. However, it comes with a waiting period of up to 90 days and a survival period of up to 30 days. People with a family history of critical illnesses should purchase this policy.

   Some of the major diseases covered by most critical illness plans include:

   • Major organ transplant
   • Cancer
   • Stroke
   • Aorta graft surgery
   • Multiple sclerosis
   • Kidney failure
   • Paralysis
   • Coronary artery bypass surgery
   • First heart attack
   • Primary pulmonary arterial hypertension

5. Maternity Insurance

   Maternity insurance is a women-specific health insurance plan designed to cover the medical expenses of pregnancy and childbirth. It pays for pre-natal & post-natal expenses, medical termination of pregnancy and newborn baby treatment expenses. Women who are already pregnant and those planning their pregnancies can opt for this policy. However, it comes with a waiting period, ranging from 3 months to up to 4 years, depending on the plan.

6. Top Up Health Insurance

   A top up health insurance policy can be used to pay for medical expenses in case your base policy has been exhausted. It comes with a mandatory deductible and offers high sum insured options. It helps you to ensure additional medical coverage instead of buying a new policy.

7. Personal Accident Insurance

   A personal accident insurance policy covers the policyholder against accidental death or physical disabilities. Under this policy, a lump sum amount is paid to the insured in case of loss of income due to permanent partial or total disability. In case of the death of the policyholder, the entire sum insured is paid to the nominee. With a PA policy, you are financially protected against accidents and their effects.

8. Mediclaim Insurance

   Mediclaim insurance compensates you for the hospitalisation expenses incurred due to an illness or accident. It includes in-patient expenses, such as nursing charges, surgery expenses, doctor’s fees, oxygen, anaesthesia, etc. This is one of the basic health plans that cover you against unforeseen hospitalization expenses, leading to a major financial burden.

Hospital Cash Insurance

A hospital cash insurance policy pays a daily cash allowance to the insured for up to a certain limit, apart from the hospitalisation expenses. This amount is paid to cover day-to-day expenses for each day of hospitalization, such as food charges, admission charges, etc. Some health plans offer hospital daily cash as an in-built cover too.

Disease-Specific Health Insurance

Disease-specific health insurance plans have been designed to address the unique healthcare needs of people suffering from different diseases. Health insurance for diabetes, dengue health insurance, coronavirus health insurance, etc., are examples of disease-specific health plans. Such plans cover the medical expenses incurred on the treatment of these specific diseases.

Other Types of Health Insurance

Alternatively, the above health insurance plans can also be divided based on the compensation provided:

1. Indemnity Health Insurance Plans
2. Fixed-benefit Health Insurance Plans

1. Indemnity Health Insurance Plans

   Indemnity health insurance plans reimburse your medical or hospitalisation expenses up to the sum insured limit. You can raise multiple claims in a policy year until your sum insured amount is exhausted. These plans include:

   • Mediclaim Insurance
   • Individual Health Insurance
   • Family Floater Health Insurance
   • Senior Citizen Health Insurance
   • Maternity Insurance
   • Top Up Health Insurance

2. Fixed-Benefit Health Insurance Plans

   Under a fixed-benefit health insurance plan, the insurer pays the entire sum insured amount in a lump sum or as a staggered payout in case of an accident or upon the detection of illness. These plans include:

   • Critical Illness Insurance
   • Personal Accident Insurance
   • Hospital Daily Cash Insurance

Reasons to Buy Health Insurance at a Young Age

Apart from the ever-rising medical expenses, the reasons for buying health insurance at a young age are:

1. Comes with Lower Premium

   Health insurance premiums are much lower if you buy it in your 20s or early 30s than in your old age. As you are less likely to fall sick in this stage of life, insurance companies offer health plans at a lower premium, considering the low-risk appetite. If you compare, the premium you pay for a plan in your 30s will cost you double in your 50s.

2. Easy to Get Insurance

   It is quite difficult to get health insurance with existing health issues. Even if you get one, you will have to pay a higher premium. Moreover, if you do not disclose your illness at the time of buying and claim for a complication arising out of such illness, your claim will get rejected by default. At a young age, you are less prone to health issues, so availing medical insurance is easy.

3. Save More on Tax

   Section 80D of the Income Tax Act 1961 benefits the policyholder with tax deductions for paying health insurance premiums. If you buy a health plan at an early age, you can enjoy tax benefits for a longer period as compared to a person who bought it in his/her middle age.

4. Easy to Serve Waiting Period

   Health insurance comes with waiting periods, such as an initial waiting period of 30 days, a pre-existing illness waiting period of up to 3 years, etc., depending from insurer to insurer. When you are hale and hearty, you do not need to claim your insurance. This way you can serve the waiting period easily and file your insurance without a hassle when you actually get sick.

5. Avail No Claim Bonus

   Medical insurance comes with an additional bonus as well. One such bonus is the No Claim Bonus that is offered for not claiming your insurance in the previous policy year. The NCB is offered as a discount in the premiums of consecutive years or as a hike in the sum insured for the same premium. When you are young, there are lesser chances of claiming your insurance, and you can earn NCB easily.

The Bottom Line!

The soaring medical costs have made it essential for everyone to own a health insurance plan in India. Since you may find a variety of health plans available to cater to your different insurance needs, it becomes vital to compare them online in terms of their offerings, premium or claim settlement ratio of the insurers. Make sure to choose a policy that best fulfils your health needs at an affordable price.