Top Benefits of a Health Insurance Plan
With the spread of the COVID-19 infection and the resultant healthcare and economic crises globally, the importance of quality healthcare has gained attention at every possible level. Additionally, many individuals and families, realized that financial protection in case of medical emergencies is something everyone must prepare for in advance.
As a result, the sale of health insurance gathered pace in the country. For instance, health insurance became the most-valuable business segment for general insurance companies in India in the first six months of 2020-21, replacing motor insurance, as per data from the General Insurance Council.
It is only natural to consider health insurance for yourself and your family in the current times of rapidly rising medical costs. Here are the top three health insurance benefits:
- Coverage against hospitalization costs
Fundamentally, health insurance provides you financial security against healthcare costs, especially in case of severe illnesses, accidents, or hospitalizations. Often, the largest chunk of cost in case of treatment of any serious illness or in case of accidents comes in the form of hospital bills. This was evident even in the cases of COVID-19, where the need for facilities like an intensive care unit or ventilators pushed the per-day hospital bills up to six figures in many large cities in India.
A health insurance policy can cover the expenses for you in such situations. Moreover, leading health insurance companies also provide cashless hospitalization, meaning that the insurance company directly settles the bill with the hospital, and you do not have to face the hassle of gathering a lot of paperwork and then making a claim.
- Financial security in case of critical illnesses
Someone standing behind you to bear the hospitalization expenses is a very good start. However, if someone falls severely ill, hospitalization and treatment cost is just one part of the financial setback the family or dependents of the ailing person face. The loss of income due to the inability to work can aggravate the financial crisis for a family in such situations. This, in turn, can have a cascading effect on the family’s financial plans, impacting the future financial goals like children’s higher education or retirement of the spouse.
A critical illness health insurance can be an ideal financial product to tackle such a situation effectively. While regular health insurance can take care of hospitalization costs, a critical illness cover provides a lump sum pay out to the insured if any critical illness occurs. This amount can be utilized for any purpose the policyholder deems fit.
- Health Insurance Tax Benefits
To promote the adoption of health insurance tax benefits and good financial practices among the masses, the government of India provides some tax incentives to people purchasing health insurance policies. Under Section 80D of the Income Tax Act, you can claim a deduction on your taxable income for the amount spent on health insurance premiums.
A deduction of up to Rs 25,000 is allowed for non-senior citizens, while senior citizens can claim a deduction of up to Rs 50,000. Accordingly, a senior citizen with senior citizen parents can claim up to Rs 1 lakh deduction under this section. A non-senior citizen with senior citizen parents can claim up to Rs 75,000, and a non-senior citizen individual or family can claim up to Rs 25,000.
However, it is critical to note that tax saving should not be the primary objective of buying a health insurance policy. The focus should be financial protection from rising healthcare costs and the financial well-being of yourself and your loved ones.
While a health insurance plan provides the above-mentioned benefits, you as a policyholder can make the best out of it only if you have adequate health insurance cover. Get your health insurance today.