The top 10 benefits of health insurance for you

What is health insurance?

Health insurance is a contract between a health insurance company and an individual. The individual pays a certain amount (premium) to the company in exchange for financial protection against healthcare expenses. The types of illnesses covered, the total payout, and the terms of treatment are all laid out in the policy document. A health insurance plan is typically valid for one year and requires annual renewals.

Why is health insurance important?

Health insurance benefits you in multiple ways, especially when it comes to your financial well-being. Illnesses, much like accidents, can happen unpredictably. They often require immediate attention in terms of medical care. This can be an expensive proposition, depending on the severity of the condition. According to a 2022 WHO report, out-of-pocket expenditure on healthcare pushes nearly 55 million Indians into poverty. Meanwhile, a health insurance policy offers immediate financial aid in medical cases, emergency or not, to prevent the depletion of your financial resources. Moreover, there’s also peace of mind knowing that in case of any illnesses, your treatment will be taken care of without you having to raise finances for it immediately. 

Health insurance is not just about treatment after the fact, but it also enables preventive care. Health insurance policies usually come with free annual health check-ups and vaccinations to help you nip health issues in the bud before they become potentially dangerous.

Top benefits of health insurance

Here are the top health insurance benefits that make it an essential investment.

1. Hospitalisation cost

The best health insurance plans cover hospitalisation costs, including room rent, ICU, medicines, diagnostic costs, etc. It also covers day-care expenses, i.e., hospitalisation only for the day, not requiring an overnight stay. Doctor and surgeon fees are also covered in case a specialist is needed for diagnostic, surgery, or consultation purposes.

2. Pre- and post-hospitalisation expenses

A health insurance policy also covers pre-hospitalisation and post-hospitalisation expenses that include diagnostic tests, medicines, consultations, and rehabilitation services. It encompasses all medical expenses, from the diagnostic stage to the hospitalisation stage to the final recovery. It may also include transport costs to the hospital in an ambulance.

3. Domiciliary and alternative treatment

Health insurance plans also cover treatment costs at home, especially if hospitalisation is not an option. Furthermore, some insurers even recognise alternative treatment methods such as Ayurveda, Yoga, Unani, Siddha, and Homoeopathy (AYUSH). Some health insurance plans cover the cost of domiciliary and alternative treatments.

4. Preventive health check-ups

A health insurance plan in India not only takes care of medical expenses when an illness strikes but also aids in preventive healthcare. Yearly health check-ups help policyholders monitor their health and take the necessary steps to prevent potential health flare-ups. These tests also aid insurers in understanding the health profile of the insured, enabling them to lower their claims outgo potentially. 

5. Early adoption to tide over the waiting period

Most health insurance policies come with a waiting period before the coverage kicks in. Taking a policy early on, when you are still healthy, allows you enough time to cover the waiting period for serious illnesses. Some waiting periods can be up to four years long, which means if you were an early adopter of a health insurance policy, in four years, you would be eligible for serious illness benefits.  

6. No claims bonus

Insurance companies reward policyholders who do not file claims with a ‘no claims bonus’. This bonus is an addition to the total sum insured of the policy, without any increase in premium. It is particularly beneficial in the long term when the likelihood and severity of a serious illness increases. You get more coverage then, for less.

7. Income tax benefit

Under Section 80D, non-senior citizens can claim up to ₹25,000 as income tax exemption on health insurance premiums. For senior citizens, that limit is extended to ₹50,000 in a financial year. This encourages individuals to avail of health insurance plans and take better care of their health.

8. Cashless treatment

One of the most significant benefits of health insurance is the fact that you get cashless treatment at network hospitals. You do not have to pay money out of your own pocket to get the necessary treatment, thereby preserving your finances in what would be an already challenging time.

9. Cumulative bonus

Insurance companies also reward you for not filing a claim. You get an increased sum insured on renewal for the same premium, ensuring more financial coverage. This is particularly helpful in expensive treatment cases.

10. Restoration benefits

Health insurance policies also come with restoration benefits. If you exhaust your coverage amount in a policy year, the sum insured can be partially or fully restored at no extra cost. While the premiums may be relatively higher to begin with, this feature is particularly helpful in cases of frequent hospitalisation, or family floater plans where the sum insured is shared among the different members of the family.  

Key Takeaways

Health insurance benefits extend to healthcare accessibility, preventive healthcare practices, and ultimately, the treatment of illnesses, without denting your financial strength. Moreover, it also provides tax benefits, and additional sum insured to healthy individuals who do not file claims. Buying a health insurance plan in India is super easy with the best insurance plans available online for you to choose from. Take advantage of platforms like PhonePe to easily purchase and manage your health insurance, ensuring you receive all the benefits without any stress.