Spend, Save and Invest Smartly
One has surely heard the proverb "Health Is Merely The Slowest Rate One Can Die". So what does this mean? .This basically means that surely life is one of the most cherished possessions one can have. All the wealth in the world is no substitute for health. Imagine what life one would lead if he suffered from diabetes, heart ailments or cancer. One would surely be living on borrowed time .However one is very fortunate to be living in the twenty first century as technological prowess in the field of medicine has been achieved with giant strides. However medical costs have risen to phenomenally high levels. Does One Dare Step Outside Without Taking That Health Insurance Policy? Would One Be Able To Bear The Huge Costs Involved If One Were To Meet With A Serious Accident? Surely one knows the answer to this. The benefits of health insurance policy are many.
Mr Suraj is 32 years of age and his wife is 30 years. Both of them exercise regularly and are in the peak of health. The premiums for a family floater for Mr Suraj his spouse and a single child are in the range of INR 8000-9000 for a coverage of INR 4-5 Lakhs..Mr Suraj believes he does not need a health insurance policy as it is a waste of money .Over the next 5 years Mr Suraj would incur costs of INR 50000 for a health policy which he believes he could have invested in the stock markets for high returns .So What Advice Would One Give Him?
Mr Suraj has discounted acts of God such as an accident or even a disease like Jaundice which in a metro like Mumbai can cost in excess of INR 30000 .A major accident could set Mr Suraj back by INR 2 Lakhs. His investment deals and expected profits in the share market would disappear in seconds. Anyone can suffer from a disease and exercise alone cannot guarantee ones health. It would be a major relief financially and mentally for Mr Suraj if he takes up a family floater plan for his family as not only can he financially cover himself , it can also be a major stress buster for Mr Suraj’s family.
Many times one must have heard from one’s friends how they state they can purchase that health policy after they fall ill. What Reply Would You Give Your Friends? This is a classic case of locking the stable after the horse has bolted .A pre existing disease is basically a health condition suffered by an individual before taking up a health policy. This information may be deliberately suppressed by an individual or a policy may be taken after the disease is detected. Diseases such as diabetes and hypertension are covered after two to four years of continuous claim free renewals. No claim must be made by the claimant with some other insurance company for the same disease or complications arising out of this disease during this period. Co payment might also be necessary or an additional premium might have to be paid to cover these diseases .One must surely have heard this regret among the top 10 regrets of all time. What If I Had Purchased That Health Policy When I Was Younger And In Good health?
Would one start building a house with insufficient construction material. It would look like an ancient ruin wouldn’t it? In a similar way one must surely insure oneself for a reasonable amount considering his health condition. This amount should be sufficient to cover hospitalization charges, Doctors charges as well as treatment charges. Surely one has to factor all this in that health policy.
In a recent survey conducted in India data showed the youth and households in urban areas hardly cared to purchase a health policy. This was widely noticed among the youth in the Southern part of our country. Even in youth and households earning above a Crore no heed was paid to that health policy. Across India only 25% of the households have health insurance and in the lower income category of urban India it is an abysmal 2%.The Western parts of India have the highest health cover with over half the households with income of 1 Crore taking up a health policy.
Moneymindz.com believes that each and every individual of our nation especially the youth should take up a health insurance policy. None of us has seen the future and being forewarned it is necessary for one to be forearmed. It is necessary for one to understand never to sit on important things but to do the needful at the earliest. Moneymindz.com also believes that one should pick up that health policy in one’s youthful days and maintain claim free years in order to procure loyalty benefits and discounts. This also eliminates problems faced due to pre-existing diseases. Do Not Sleep On Such An Important Job. Get That Health Policy Today. One can reap its benefits in ones old age.
Most of us look at the premium amounts of a health policy and pick up that policy which has the lowest premium. The result of this is a lot of heartburn. This is like comparing apples to oranges rather than apples to apples. The result of this is a disaster. This is similar to the principle of purchasing penny stocks with the hope that it will make one rich.But Does It Do So. It is very rare that this takes place. Most of the time one loses everything .If one has to compare a health policy it is best that one thoroughly studies the policies and picks up the best policy not just by looking at the price but taking all factors into consideration. One must start by reading the fine print carefully. One cannot study an elephant just by looking at its trunk. In a similar manner one has to thoroughly study the health policy and not just the premium.
What Is The Use Of A Health Policy If it Does Not Serve You When You Need It The Most?.Always check out the maximum renewal age of that health policy. Always check and see if these policies have a lifetime clause. If not one will have to bear medical bills in his old age which would be sky high. When one purchases a health policy look out to see that ones family is covered for a reasonable length of time. Choose wisely only those policies which have a lifetime renewability clause. Else one might "Buy in Haste and Repent at Leisure".
This saying basically means "Always Plan Ahead". One must never wait for the problem to take root before finding a solution. This holds good when one has to decide on the sum assured. This calls for a forward thinking approach. Always choose a sum assured in that family floater policy which is sufficient. If one takes a coverage of INR 2-3 Lakhs on a family floater policy it tends to be insufficient. One has to choose a coverage amount which is sufficient to protect ones family keeping in mind the effects inflation has on those medical bills. A family floater policy takes the age of the senior most beneficiary of the policy when calculating the premium. After ones age crosses 45 years one notices a huge jump in the premium amounts to as high as 40%.Always lock on to the higher levels of coverage at a younger age. Do not try to upgrade these policies at a later age as the premiums tend to be very high at older ages. Medical tests may be required and if ones family members contract a disease in the interim period this disease is excluded for the upgraded amount .Upgrade is as good as purchasing a new policy at an older age paying higher premiums and is certainly not recommended. Always factor in deductions and exclusions while purchasing that health policy.
Each mediclaim policy has certain in built features which add muscle to it. Certain health policies might exclude preexisting diseases for a period of 4 Years while certain policies might exclude preexisting diseases for a couple of years. The policies which exclude preexisting diseases for a couple of years have a better rating than the four year policy. The health policy might have a sublimit clause which caps or limits the hospital room rent to a particular amount. In the hospital not just the room but also the Doctor’s charges and service charges differ. Different rooms have different charges for doctors and services and this point needs to be noted .One also should study the copayment clause where one has to bear a measure of the cost. This might vary from 10% to 20%.Always choose policies which do not have sub limit clauses on expenditure and on diseases. Even though these health policy premiums might be marginally higher they cover a higher financial risk. The claims settlement record and lifetime renewability clauses are very important in these policies and play a very important role in their ratings. The health policies which provide comprehensive coverage have a higher rating.
Let us consider that one has a health insurance policy of INR 3 Lakhs. One can take a top up policy of another INR 5 Lakhs. The insurance Company will pay up if ones medical bills exceed INR 3 Lakhs .If one runs a medical bill of INR 7 Lakhs then an amount of INR 3 Lakhs is payed from the first policy and the remaining 4 Lakhs from the top up health policy. The top up policy has a threshold limit beyond which the insurance Company starts paying up.In this case it is any amount beyond INR 3 Lakhs. Every time one falls ill he has to cross the threshold limit in order to claim benefits from these policies. There is also another kind of policy called the super top up policy. In this case if the threshold limit is INR 3 Lakhs and one has already run 2 bills of INR 2 Lakhs and INR 1 Lakh then the third time if one runs a medical bill of INR 2 Lakhs then one gets reimbursed unlike a top up policy where one has to exceed the threshold limit of INR 3 Lakhs every time.
One can claim deductions under Section 80 D for the health policy one takes. One can avail deductions up to a maximum of INR 15000 for a health policy taken for oneself, spouse and dependent children .For the senior citizens above the age of 65 Years the deduction amounts are enhanced to INR 20000.No deduction is allowed under Section 80 D if the premium for the health policy is paid in cash. The payment has to be made in the form of a cheque, draft, credit card or online banking. One cannot avail deductions for the health policy taken in the name of In-Laws even if they are Senior citizens. One’s spouse has to make payments for his/her parents out of one’s taxable income.
I would like to end this article using the famous phrase "Those Who Have No Time For Bodily Exercise Will Sooner Or Later Have To Make Time For Illness". Never compromise on one’s health and practice a healthy lifestyle. However do exercise caution and take up a health policy. This will serve as a backup in case of a health emergency."To Avoid Sickness Eat Less To Prolong Life Worry Less".