5 Key Factors to Consider Before Choosing a Health Insurance Plan

Taking precautionary steps towards your health is most important. Given the rising cost of healthcare, opting for a health insurance policy is the need of the hour. It not only reduces your overall expense while battling any disease, but it also gives you mental peace. It starts with getting the right coverage for your needs, which can be a deal-breaker in times of illness.

If you’re unsure what to look for, here’s a detailed guide on the five key factors before buying a policy.

1. Coverage and Benefits

Buying any policy without checking what it covers is a mistake. Some only handle hospital charges, while others also pay for ambulance fees, medication, or routine check-ups. You want to be sure about these points. If you have a specific condition or a family history of certain illnesses, see if the plan lists them as part of coverage. If not, explore riders that bring extra protection.

A few policies offer advanced benefits like coverage for critical illnesses. That means you receive a lump sum payment if you’re diagnosed with something like cancer, heart disease, or kidney failure. This can significantly help offset income loss, especially if you need a long break from work. Ensure you read all the details to know which ailments are included.

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2. Waiting Periods for Existing Ailments

Many people have at least one health issue before buying an insurance plan. That might be high blood pressure, diabetes, or other chronic problems. Often, health insurance companies put a waiting period on these pre-existing conditions. It can last two to four years, or sometimes longer, during which you can’t claim for treatment linked to those conditions.

If you’re dealing with such a condition, check each policy’s waiting period. A plan with a three-year wait might not be as good as one with a two-year wait, especially if you think you might need treatment soon. If the plan has a short wait, that’s a point in its favour. It could help you save money on hospital bills far earlier.

3. The Process of Claim Settlement

When you file a claim, you hope for a hassle-free experience. Nobody wants extended calls, repeated email requests, or late-night worries over unpaid bills. That’s where a high claim settlement ratio (CSR) matters. A ratio above 95% for premium insurers like Axis Max Life Insurance is typically good, meaning they settle the most valid claims.

You might also want to know if the policy has an extensive network of hospitals for cashless treatment. This benefit means you won’t have to pay the hospital first and then wait for reimbursement. Instead, the insurer handles payments directly. A vast hospital network near your home or workplace helps you get quick care at familiar places.

It’s just as important to know how easy it is to fill out forms or attach documents for a claim. Some insurers have started using online portals that speed things up. Others might still need you to submit physical forms. Check which system is more convenient for you.

4. Premiums, Deductibles, and Other Costs

Everyone looks at the premium first. But it’s not the only number that matters in a health insurance plan. Other expenses like deductibles, co-payments, and sub-limits also decide how much you’ll pay from your pocket when something happens.

A deductible is what you pay out of your funds before the provider starts covering the costs. High deductibles might mean a lower premium, but it also means more cash from your pocket in an emergency. Co-payment (or co-pay) implies a part of each hospital bill that you have to pay. If your co-pay is 10%, you pay 10% of any claim, no matter how big.

Sub-limits can be tricky. Some policies only pay a set amount for specific treatments or surgeries. If you need a more expensive treatment, you must pay the extra portion. So, if the policy says it’ll pay only Rs. 2,000 per day for a hospital room, and you pick a room costing Rs. 5,000, guess who pays the difference? It’s you.

The choice of plan depends on your medical history and finances. An older person or someone with many medical issues might prefer a policy with zero or minimal deductibles or co-pays, even if it costs more each year. Meanwhile, a healthy person might choose a lower premium with a higher deductible, hoping they won’t need hospital care soon.

5. Tax Benefits and Other Add-Ons

One valuable advantage of a health insurance plan in India is the tax deduction you can claim under Section 80D. This helps you save a good part of the money on taxes, depending on your age and whether your parents are also included under the coverage. Married couples with dependent parents can get better tax benefits.

But tax savings shouldn’t be the only reason to purchase. The real purpose is your well-being. The tax break is a bonus that improves the deal. Also, some insurers like Axis Max Life Insurance let you add riders, such as coverage for accidents, maternity, or critical illnesses. Think of these as expansions to your primary plan. You’ll pay a bit more, but you also get extra security.

Conclusion

The best health insurance plan is one that suits your situation. If you’re young and healthy, you can choose a policy with a modest sum assured and a lower premium. If you’re older or have medical conditions, you may pay more, but you’ll also gain coverage you’ll likely need.

Many premium insurance providers, like Axis Max Life Insurance, offer comprehensive health insurance plans with critical illness coverage, tax benefits, and a 99.65% claim settlement ratio. These aspects are essential for securing your financial future and ensuring medical emergencies don’t become financial burdens.

Don’t forget your health plan works best when combined with term insurance plans that protect your family’s future. While health coverage handles your hospital bills, the latter gives your family a financial cushion in case of your unfortunate demise. It’s good to have both, so your loved ones don’t have to handle big expenses alone.

So, take your time. Compare, reflect on your needs, consider your budget, and then pick a plan that looks out for your health and wallet. In the end, a well-chosen health insurance policy keeps you free from hospital cost worries, letting you focus on recovery if something goes wrong.

Standard T&C apply

Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms and conditions, please read the sales brochure/policy wording carefully before concluding a sale.

Disclaimer: The content on this page is generic and shared only for informational and explanatory purposes. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making any related decisions.

Note: The tax benefit is subject to change as per prevalent tax laws.