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Can a ₹5 lakh medical insurance cover take care of your needs?

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A health insurance policy can safeguard you and your family during medical emergencies and prevent major financial setbacks. If you have an adequate healthcare plan, you can either avail of cashless hospitalisation or file a reimbursement claim with the insurance company. That being said, how much health insurance should be adequate in India? Is health insurance of INR 5 lakhs adequate to take care of your medical expenses?

While an INR 5 lakhs health insurance policy should be ideal for young adults, older individuals and senior citizens must opt for higher coverage. Let’s understand this in detail.

Is a health insurance cover of INR 5 lakhs adequate?

A health insurance plan of INR 5 lakhs might be adequate during certain situations but not for all. So, when buying health insurance, make sure you keep the following points in mind and choose a policy coverage accordingly.

1. Age:

If you buy health insurance at a young age, a cover of INR 5 lakhs should be adequate, provided you are not suffering from a pre-existing health condition. On the other hand, elderly adults or senior citizens must opt for a higher sum insured. Since health conditions and hospitalisations increase with age, health insurance of INR 5 lakhs may not be sufficient in most cases.

2. Health insurance type:

If you plan to buy an individual medical insurance policy, a cover of INR 5 lakhs may be sufficient. However, if you are opting for a family floater policy, you need higher coverage depending on the number of people you want to cover under the healthcare plan.

3. Treatment costs:

Identify the treatment costs of some common health issues, such as heart ailments, stroke, cancer and kidney failure, and choose the sum insured accordingly. This is particularly important for those with a family history of critical illnesses.

For instance, the treatment of a heart ailment can cost you more than INR 5 lakhs, especially if you reside in a metropolitan city where healthcare expenses are on the higher side.

4. The number of health plans:

If you are young and covered under corporate or employee health insurance, a personal health insurance plan with the sum insured of INR 5 lakhs should be sufficient.

5. Lifestyle:

This is an important factor to consider when you are deciding on the coverage amount of your medical insurance plan. Unhealthy lifestyle habits, such as being less active and consuming unhealthy foods, can lead to diabetes, high cholesterol, hypertension and other lifestyle diseases as you grow older. In such cases, health insurance of 5 lakhs may not be sufficient in the long run.

6. Affordability:

Make sure you choose a sum insured depending on the policy premium. An INR 5 lakhs health insurance premium should be approximately between INR 5000 and INR 8000 annually. If you can pay a higher premium, you must opt for a healthcare plan of more than INR 5 lakhs. Choose a sum insured you can afford to keep the policy active for long.

What is the right amount of coverage that one needs to opt for?

Financial experts say your health insurance coverage should be at least 50% of your annual income.

For instance, if your annual income is INR 15 lakhs, you must try to take medical insurance coverage of INR 7.5 lakhs. This can help cover your medical bills and keep your savings intact.

Do some research to find the best health insurance in India for assured coverage during medical emergencies.

Should you include riders and top-ups?

Health insurance riders and top-ups can enhance your policy coverage and take care of your medical bills. You can opt for these if you feel your existing health insurance coverage is inadequate.

Riders are added benefits that you can add to your medical insurance policy for better coverage. With the aid of riders, you can increase or expand the scope of coverage of your healthcare plan as per your requirements. Some examples of health insurance riders are coverage pertaining to critical illness, accidental disability, room rent waiver, and maternity cover.

Let’s understand health insurance top-ups with the following example:

Suppose you have health insurance coverage of INR 5 lakhs and a top-up plan of INR 4 lakhs. There is a medical emergency, and your hospital bills add up to INR 7 lakhs. In this case, you must first use your health insurance policy to claim the amount of INR 5 lakhs and then file a claim for the remaining INR 2 lakhs from the top-up plan.

How much does INR 5 lakhs health insurance premium add up to?

The premium of an INR 5 lakhs healthcare plan will vary from insurer to insurer and policy to policy. While some health insurance policies have a nominal premium of about INR 5000 annually, others may have higher annual premiums of about INR 7000 to INR 8000 or more.

The premium of your healthcare plan will depend on certain factors, such as your age, health, city of residence andpolicy inclusions.

• Health insurance premiums increase with age.

• If you have one or more pre-existing conditions, the premium of your health insurance plan will increase.

• If you reside in a city where healthcare costs are on the higher side, you will have to pay a higher premium on the sum insured.

• A policy offering wider coverage will attract a higher premium.

In a nutshell

While an INR5 lakhs health insurance policy may be adequate for minor health issues and hospitalisations, it may not be sufficient for critical illnesses. So, make sure you study your health insurance requirements and then opt for adequate coverage accordingly. This will ensure complete protection during medical emergencies and save you from paying hospital bills from your savings.

FAQs

1. What is the right age to take a health insurance policy?

The right age to buy medical insurance is when you are in your mid-twenties or early thirties. There are many benefits of buying health insurance early, i.e., when you are young and healthy.

• You can get a healthcare plan without any pre-policy medical check-ups.

• The policy premium will be on the lower side.

• Since you are less likely to make a health insurance claim, you can enjoy a no-claim bonus for every claim-free year.

• You can also complete the waiting period early.

2. I have a health plan of INR 5 lakhs. Should I take another health plan or opt for a top-up for better coverage?

A top-up is a good option if you want to increase your policy coverage with the same insurance provider. You can enhance the coverage by paying an additional premium annually. Top-ups are easier on the pocket when compared to buying a new healthcare plan. Buying another health insurance plan is a good option only if you want to opt for a policy offered by another insurance provider or if you want to cover your elderly parents under a separate medical insurance plan.

3. How to choose the right health insurance coverage?

The right coverage of your health insurance policy will depend on certain factors, such as your current age, place of residence, health condition, lifestyle, and family medical history. A medical insurance plan of INR 5 lakhs should be sufficient if you are young and healthy. However, if you are an older adult with some pre-existing conditions, you need a higher sum insured. Also, if you reside in a city where medical expenses are on the higher side, you must choose your health insurance coverage accordingly.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

 

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