It is a type of insurance that covers the insured’s medical and surgical expenses. Depending on the policy terms and conditions, the insurer either pays the insured in the form of reimbursement or offers a cashless facility at the listed network hospital of the Insurance Company.

• Mediclaim policy: It reimburses the hospitalization expenses owing to illness or injury suffered by the insured, whether the hospitalization is domiciliary or otherwise. It does not cover outpatient treatments. Government has exempted the premium paid by individuals from their taxable income.

Points to consider while investing in health insurance :

• Sum Insured

The rate of inflation in hospitalization is high. Consider the members you are including in the policy based on it take a call on the sum insured.

• Incurred claim ratio of the companies

ICR is available only for non-insurance companies, it is wise to choose a company that does not have a high ICR nor low ICR(Incurred Claim Ratio or ICR=(Total Value of Claims Paid/Total Premiums collected)*100)

• Buy early:
• Understand the cover:
• Individual or Family Floater
• Entry Age and renewable clause
• Waiting period: Identify the company which covers existing diseases at early. Usually, all insurance companies have a waiting period of 3-4 years for existing diseases.
• Co-payment clause:Higher the co-payment means lower the premium for you. Co-payment means how much you also have to pay in a total bill.
• Policy Wordings: Read carefully the wordings of policy brochure. If you have doubts on any feature, then try to clarify it immediately
• Treatment wise limit: Check treatment wise limit if any.
• Premium:Check the premium rates. Especially check the rates for older age rates as few insurers jump the rate drastically for older age coverage.

Types of Health Insurance Policies in India

• Individual Health Insurance Plan

It is specially designed to provide coverage  to an individual against a variety of illnesses with cashless hospitalization and other add-on benefits.

• Family Floater Mediclaim Policy

Family health insurance plans cover the entire family in one health insurance plan.  Most health insurance companies in India offering family insurance have a wide network of hospitals that help the insured people in times of an emergency.

• Senior Citizen Health Plan – This insurance policy is specially designed to protect you from health issues during your old age. As per the IRDA norms, every insurance company must provide cover for people up to the age of 65 years.
• Maternity Plans- Maternity health insurance plans provide coverage for maternity and other additional expenses.
• Surgery & Critical Illness Policy – It is normally taken as a  standalone policy or a rider that provides coverage against serious illnesses like- cancer, kidney failure, heart attack, paralysis etc. As the treatment of such diseases is  very expensive so the premium is also on a higher side.
• Pre-existing Disease Cover – Many insurance companies also offer coverage against the pre-existing diseases such as diabetes, cancer etc.  It includes those diseases that the policyholder had before buying the policy.
• Preventative Healthcare –  This plan offers preventive care treatments like regular checkups, consultation charges and other tests or x-ray fee concessions. The idea is to monitor your health at timely intervals and provide overall health care benefits.

Two claims under a mediclaim policy:

• Cashless procedure : It is a process in which the insured is treated in the hospitals that is under the network of the insurer. Under this the insurer will pay a part of a claim or the entire amount to the hospital.
• Reimbursement: When it comes to reimbursement, it is essential to inform about the hospitalization to the insurer what has happened.

Mandatory health insurance schemes or government run schemes include:

• Employer State Insurance Scheme (ESI)
• Central Government Health Insurance Scheme(CGHS)
• Universal Health Insurance Scheme (UHIS)
• Employer based schemes (Railways, Defence, etc)