As per estimates from experts, medical inflation in India is experiencing a 15% rise year-on-year. This means that the cost of medical treatments, surgeries, and medicines will continue to increase, and rather significantly at that. In view of this it’s important to remember that buying health insurance is a given. But, what’s more important is buying the right coverage. After all, what good is insurance if it doesn’t cover the cost of treatment when the end goal is to curb out-of-pocket expenses?
Picking coverage shouldn’t be based on guesswork. Instead, you should consider the plans that offer the best medical and financial coverage, as well as on the basis of your family size. Here’s how to build your health insurance policy so that it serves all your interests.
Factor In Your Family Size To Decide
There is no fixed amount of coverage that suits everyone. What may be sufficient for someone else may be insufficient for you. Think of it like shopping for a pair of jeans. You have to pick one that fits you perfectly, and the style that fits your friend may seem unflattering on you. So, start by determining whom you plan on covering with health insurance.
This is rather straightforward if you are single. Simply consider any chronic ailments that you have and the ones that you are at risk for. But if you have a spouse and two children, make sure to consider each person’s medical risk. This includes pre-existing conditions as well as those that you’re at risk of.
For example, if your spouse suffers from asthma, it is possible that your children are at risk of developing the condition too. In this manner you can determine how much coverage you need. Also, the ages of the people in your family will also help you determine the coverage. The older you get, the higher are the medical costs that you’re likely to incur. Similarly, if your child was premature, he/she may be at greater risk of contracting certain illnesses.
Keep Future Costs In Mind
A head count and determining everyone’s age and ailments is not enough. This is because this only tells you what coverage you need at present. You will also have to factor in expected costs. Using the rate of inflation you can work towards an estimate.
For instance, if you and your spouse are buying a health cover together and plan to have a child in the next three years, use the rate of inflation to calculate what associated costs will be three years hence. On the other hand, if you are buying health insurance cover for yourself, your spouse, daughter, and your elderly parents then apart from everything else also include the cost of a bypass surgery, knee replacement surgery, and other geriatric hospitalisation costs in your policy to be prepared for future treatments based on their current age. So, if your parents are in their later 50s and a bypass surgery costs Rs.5 lakh today, use the average rate of inflation to check how much it will come to 5–6 years from now.
Use Add-On Covers To Your Advantage
The more inclusive your health insurance is, the more swiftly you’ll be able to deal with hefty medical expenses. So, if you have the budget and wish to make your health insurance absolutely watertight, opt for add-on coverage in the form of top-ups or riders to cater to any specific concerns that you have. You can include add-on coverage for critical illnesses, maternity care, recovery expenses like rehabilitation and counselling, and per-day expenses during hospitalisation in case your primary health insurance doesn’t cover this or offers insufficient coverage.
When you adopt this 3-step approach, you’ll have a clear picture of the coverage. This means that the odd health scare doesn’t throw your finances and peace of mind off track.
The writer is CEO, BankBazaar.com