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In the event of a medical emergency, the cost of hospitalisation and other associated expenses can become a financial liability. Considering this, one can get financial backup in the form of health insurance and enjoy coverage benefits.

Medical insurance covers a range of hospital expenses and reimburses the costs directly to an insured person. Several types of insurance plans are available in India. One can choose a plan as per their requirement. Additionally, the Government of India introduced a series of health schemes focused on achieving better insurance penetration in the country.

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However, individuals might wonder why it is essential to obtain a health plan. The following section answers the question precisely.

Top 5 reasons to obtain a medical insurance policy

As applicants need to pay a certain amount as an insurance premium to get the coverage benefits under a health scheme. It is natural to consider its importance before making any investment. Here are some reasons why one should consider a health plan:

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1. Covering changing lifestyles

With modernization and development, there is a noticeable change in an individual’s lifestyle that can have an adverse impact on their health. For instance, bad food habits, hectic lifestyles, plummeting levels of pollution, etc., increase the risks of diseases and other health problems.

Keeping this in mind, one might get sufficient financial assistance in the form of insurance and protect oneself from financial losses. In addition, a well-rounded insurance policy covers a policyholder’s changing lifestyles and offers a host of other benefits.

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2. Rising medical costs

As per PwC’s Health Research Institute’s projections, there is a 6.5% medical cost trend in 2022, which is higher than projected between 2016 and 2020. Due to this rising medical inflation, individuals are compelled to exhaust their savings during 6.5% health emergencies. It has taken a toll on their future plans and increased their financial burden. Hence, financial assistance from an insurance plan is a necessity. 

3. Income tax benefit Individuals paying medical insurance premiums can enjoy income tax deductions under Section 80 D of the Income Tax Act. Up to 60 years of age, policyholders can claim deductions up to Rs.25,000 on the premiums paid towards an insurance plan for themselves, their spouses, or children. Furthermore, potential buyers obtaining an insurance plan for their parents above 60 years of age can claim

deductions up to Rs.50,000. Thus, purchasing a health scheme today is practical for tax benefits.

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4. Covering pre-and post-hospitalisation costs

A medical insurance policy covers a range of Out-Patient departments (OPD) and diagnostic tests expenses. It is imperative that with rising medical expenses, the costs of OPD and other medical tests have increased. Considering this, one should obtain a health plan and get coverage benefits for several pre-and post-hospitalisation costs. However, it is important to note that these benefits are available only after a certain stipulated period from the date of insurance purchase.

5. For comprehensive coverage

Besides covering hospitalisation costs, medical insurance covers ambulance costs, daycare surgeries expenses, health check-ups and vaccination costs, etc. Some insurance companies also offer coverage for AYUSH treatment. Thus, it is evident that a health plan provides comprehensive coverage and curtails financial liability. One such standard insurance policy launched by the IRDAI on 1 April 2020 is the Aarogya Sanjeevani Policy. This policy comes with a sum insured ranging between Rs.1 lakh to Rs.5 lakh. The benefits under this plan are available for both individuals and families. Furthermore, it covers hospitalisation costs due to COVID-19 and is more economical than other health plans.

To conclude, medical insurance plans are an essential tool in recent times that helps in decreasing an individual’s financial burden. As health issues and emergencies are uncertain, it is practical to obtain an insurance plan beforehand and enjoy benefits for a long time.

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