Pros & Cons of Health Insurance in India - A Complete Guide

What is Health Insurance?

First of all, just take a short look at what health insurance actually is.

Health insurance is a plan that helps you pay your medical costs that arise due to hospital bills or surgeries when you get sick or need any type of treatment. Basically, it is an agreement between you (the insured) and the insurance company (the insurer). To keep this active, you need to pay a regular amount known as a premium, and in return, the insurance company will cover your medical expenses whenever you are in need.

The health insurance plans can be different for everyone. There are some that will pay you back for your medical expenses and others that pay the hospital directly. In other cases, where permanent disability has occurred, there will be regular payments from the insurance to support your daily expenses.

Advantages of Health Insurance

1. Protects You from Financial Problems at the Time of Emergency

Health insurance helps you handle the high costs of medical emergencies. Unexpected hospital stays or long treatments can be very expensive. In that respect, having health insurance reduces your stress since a major part of these medical costs would be covered by the insurance company.

2. Keeps Your Savings Safe

Health insurance helps protect your savings even in the case of medical emergencies. Instead of spending your savings on such costly medical bills, your insurance firm pays them for you. This is how your savings stay safe and for other important needs.

3. Give the Benefit of Cashless Hospitalization

You can also avail cashless hospitalization with the help of health insurance. You don't have to pay the hospital bill when you get discharged. The insurance company will pay the hospital directly. But this is available only at the network hospitals of the insurance company. So, you have to choose a network hospital to avail this benefit.

4. Provide Access to Preventive Care

Health insurance also covers preventive care, like regular check-ups, vaccinations, and screenings. These services help you stay healthy and detect any health problems early, preventing bigger issues later.

5. Saves Money on Medicines and Doctor Visits

Many health insurance plans help pay for prescription medicines, which will save you a lot of money. This can be very helpful if you have a long-term illness. In addition, some plans may also cover the cost of doctor visits or outpatient treatments, so routine healthcare is less expensive.

6. Helps Save Your Taxes

Health insurance not only keeps you safe but also helps you save on taxes. Under Section 80D of the Income Tax Act, you can get a tax deduction on the premiums you pay. This means you pay less tax while staying protected with health coverage.

7. Give you Extra Benefits

Health insurance plans often offer more than just basic coverage. They may include benefits like coverage for serious illnesses, maternity costs, wellness programs, second opinions, alternative treatments, and ambulance services. You can choose extra features to match your needs and make your plan even better.

8. Advantage of Getting No Claim Bonus

If you don’t make any claims during a policy year, your health insurance gives you a reward called a "no-claim bonus." This increases the amount of coverage you get without raising your premium. It’s a great way to get extra protection without paying more!

Disadvantages of Health Insurance

Now, let's understand some disadvantages of buying a health insurance policy:

1. Waiting Period for Pre-existing Conditions

Health insurance does not cover pre-existing diseases right away. You have to wait for a specific time, usually 3-4 years, before you can make claims for these conditions.

2. Premium Increases with Age

As you get older, the cost of health insurance increases. This happens because the chances of needing medical care are higher as you age.

3. Limits and Exclusions

Health insurance doesn’t cover everything. Some treatments or services might not be included, so you may have to pay for them yourself. It’s important to read your policy carefully to know what is covered.

4. Co-payment Clause

Some health insurance plans require you to share the medical expenses with the company. For example, if your bill is Rs 1 lakh and your policy has a 20% co-payment clause, you will have to pay Rs 20,000, and the company will cover Rs 80,000.

5. Waiting Period for Some Treatments

For certain illnesses or treatments, there is a waiting period before the policy starts covering them. If you need immediate treatment during this time, the costs won’t be covered. It’s important to review your policy to understand these waiting periods.

Conclusion

Health insurance is very important today to handle rising medical costs. It helps protect your savings and ensures you get proper treatment when needed. Be sure to choose a plan that matches your health needs. You can visit squareinsurance.in to compare different health insurance plans and pick the best one for you.