Health Insurance meaning

Health Insurance

It is a type of insurance that covers the policyholder for medical expenses in case of a sudden health emergency, like illness or can cover hospitalization, surgical expenses, daycare expenses, ambulance fees, and can pay your bill directly to hospitals or can reimburse your bills.

Health insurance policy means there will be a written format/contract where every detail will be explained like coverage types, tenure, etc.

Importance of health insurance

Current urban life is fast and fun however it also brings with it stress and worry. there’s simply not enough time for things that matter or to be ready for any contingency therefore there are quite enough reasons for you to urge insurance.

1-Cover costs of before and after hospitalization

Medical prices are rising by double digits and the price of treatment in India has arisen manifold and it’s rising at 15% a year as you become older you need more medical attention.

The great benefit of having a health insurance policy is that it can cover your expenses pre and post-hospitalization. As the medical emergencies do not come with prior notice.


In case of medical emergencies, you don’t have to arrange cash in order to pay your bills.your insurer will settle all the expenses. It can be cashless or reimbursement.

3-Tax benefits

Heath insurance policy will allow you to enjoy the benefit of saving tax simultaneously covering you under section 80D of the Income Tax Act 1961.

We all know that because of unhealthy eating habits and lifestyle lead to increase in health cost. sometimes it can be so costly that it can create a big hole in ones everyone must have health insurance.

Below are the basic health insurance plan-

Types of health insurance planSuitability
Individual Plan Individual
Family health insurance planWhole family-Self, Spouse, parents, and children
Group cover plan Corporate companies
Senior citizen health insurance Age of 65 and above
Critical illness health cover Cover against fatal diseases

1-Individual health insurance plan

The plan that covers the medical expense of insured can be surgical expenses, pre & post hospitalizations etc.the plan is decied based on the medical history and age of an individual buying the plan.

2-Family health insurance plan

If a person wants to buy health insurance for whole family(self, parents, children, spouse) in a single plan then he or she should go for family insurance will insure all the members in the family and if something happens to any of them, it can be claimed. the premium for this plan is decided based on the eldest members in the family.

3-Group cover plan

This plan is bought by the employer for its employees. the premium of this plan is lower than the individual plan.these are standard plan and offers the same benefits to all employees.

4-Senior citizen health insurance

At old age health issues are very common which leads to high expenses .so insurance companies have designed the plan based on their needs. these plans will only cover the age 65 and above. Generally, the premium for senior citizen health insurance is higher compared to other policies.

5-Critical illness health cover

This policy will cover the expenses of some serious issues/diseases like paralysis, cancer, brain tumor, etc. these policies generally pay a lump sum amount to the insurer when he/she is diagnosed with a critical illness. the lump sum amount also can be used as a monthly expenditure in case if you are not able to work.

How to choose a good health insurance plan

Choosing a health insurance plan is a tedious task now a day we have a number of health policies available in the market, you have to be wise enough to select the perfect one based on your requirement or very close to it.

Below you will find list of checklists which might help you in selecting the right policies-

1-Sum Assured amount should be maximum

Always go for the plan which offers maximum coverage amount to meet up the medical health emergencies. since the medical expenses is going up day by day you should the policy which offers you sufficient amount.

For example-Any major surgery now can cost around 3 to 4 lakhs and this will be a huge amount for middle-class families. Therefore make sure you choose a maximum coverage amount policy.

2-Buy affordable plans

Less is more. try to take the maximum benefits by paying less but don’t compromise with the price if the plan is giving you maximum can buy the plan at the starting of your career so that you have to pay reasonable premiums that can cover the most.

3-Choose a plan which can be renewed regularly

Before finalizing any plan make sure you check the age at which the plan can cover you is so because you need a health plan later part of your age like above 65. Therefore select the plan which can be renewed regularly.

4-Compare the insurer quote

you can compare the plans of other insurance companies online by submitting your details and then arrive at a final can also do this by asking your broker or calling customer care of insurance companies in case if you don’t want online.

5-Network hospitals

Always check if your insurance provider is having a pan India network of will help you to get benefits wherever you are. Because network hospitals provide faster and convenient services and also you will get rid of filling forms once you have a card from the respective insurance provider.

6-Claim settlement ratio

Check with your every insurer what is their claim settlement ratio. It is the number of claims settled by the insurance provider over the total claim received. Always choose the insurer which has high claim settlement ratio.

I hope above points will help you to choose perfect health insurance plan.

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