How much health insurance do you need to cover your spouse, children and parents?

health insurance, #insurance, medical inflation, absence of an adequate health insurance, family floater

Health insurance is an indispensable pre-requisite of a modern life that grapples with multiple health deteriorating stressors every day, including lifestyle imbalances and degrading air quality. An adequate medical insurance cover can take care of diagnosis, treatment and healthcare in the most affordable as well as dignified manner.

In recent times, medical inflation increased at varied rates – 8-23 percent in different states. With consistent rise in cost of medicines, medical tests, in-hospitalisation and consultation fees, the sum assured requirement for your family is thus bound to change, and keep increasing. With evolving life stages, fluctuating incomes and inescapable inflation, it is a good practice to review your family’s health insurance needs every three years.

Rs 5 Lakh family floater is not sufficient

Let’s assume that, on an average, medical inflation impacts cost of hospitalisation at 15 percent. So, the treatment that costs Rs 4 lakh today in the hospital will cost Rs 16 Lakh after 10 years. The cost will escalate to Rs 65 Lakh after 20 years. Further, the cost of annual premium will continue to escalate, if the policy is purchased at an advanced age. It is thus always advisable to sign up early for high value covers at low cost.

A household with young kids and senior parents is clearly not sufficiently covered in a ‘Rs. 5 lakh family floater plan’ any longer. In the absence of a right insurance plan, each medical procedure, ranging from routine dentures to non-invasive surgeries, to more specific health care for critical illnesses, can severely dent your cash flow.

In a pandemic-afflicted world, we are witnessing harsh repercussions of medical emergencies. In the absence of an adequate health insurance, your present savings as well as future well-being is at considerable (but avoidable) risk.

Also read: Health policy premium hiked during renewal? Port out to a new insurer

Regularly Top-up Sum Assured

Every age group has distinctive medical risks and coverage needs. While the young kids are more prone to outdoor injuries, the adults are at risk of on road accidents and the seniors mostly live with pre-existing health & medical ailments. Thus, a family with young kids as well as senior parents, should essentially opt for a combination of available products. Never depend on a single policy. Do avail family floater plan, employer’s group insurance and individual insurance plans for each parent. Signing for a top-up with a family floater (& deductible) of Rs 10 Lakh, you can affordably opt for an insurance cover of Rs 1 crore.

For example, a family floater at 35 years of age covering 2 adults & 2 children can be topped up for Rs 90 Lakh with Rs 10 lakh tax deductible amount with annual premium of Rs 5800. The same top-up plan at the age of 60 years will cost Rs 21000 annually.

Buy individual plans for parents

Adding a parent into your family floater plan can be a costly mistake. For, the cost of premium is decided basis the age of the eldest member in the group. The policy expires as the eldest member reaches the maximum age for cover.

An individual insurance plan on the other hand will offer more comprehensive coverage for elderly. At 60 years, the policyholder is more likely to have pre-owned diseases & several heath risks. Under an individual specific plan, the policyholder can get wider coverage for emergency medical situations, involving preventive health check-ups, in-patient hospitalisation, pre & post-hospital care, ambulance charges etc. On an average, Rs 10 lakh individual plan separately for each parent can take care of maximum expenses owing to critical diseases as well as pre-owned diseases. Do add a critical illness cover early in life and opt for a disease specific top-up as per the requirement in the later days.

Employer’s Group Cover:

Employee benefit programs are cost-effective insurance plans. These plans offer affordable comprehensive coverage for you as well as your family members. The cashless claim is extended for pre-existing illnesses as well as maternity expenses from the day one of inclusion. There is no waiting period and thus it makes employer’s insurance plans as one of the most affordable covers. They can come handy for urgent medical expenses. It also lets you continue your no claim bonus on the primary floater plan, by taking care of smaller health complications.

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