The idiom health is wealth is of greater truth in the present day and age when the numbers of health issues are on the rise. The good part is that people are definitely taking more interest in maintaining a healthier lifestyle as the awareness around these issues increases. However, one aspect of taking care of health which is often ignored by people is getting adequate insurance to cover the costs associated with the diagnosis and treatment of health conditions.
While buying of hospitalisation insurance has shown an improving trend in recent years, it is equally important to consider some of the other health insurance products, which provide useful benefits, reducing the financial stress associated with the onset of health conditions. A hospital benefits policy typically covers only the hospitalisation and pre and post hospitalisation medical expenses and it might not suffice for the cost of treatment of more major illnesses where treatment can extend for a longer period of time. Further, if a person suffering from the illness is the breadwinner of the family, their period of illness often coincides with loss of pay, due to the inability to work, which adds to the financial burden.
In such situations, a fixed benefit critical illness product can be extremely useful as it provides a fixed lump sum benefit upon the diagnosis of any of the stated critical illnesses covered under the plan, irrespective of the actual amount of funds being incurred on the treatment. There is a range of products available, such as products, which cover a range of illnesses to single or limited illnesses products. The type of product one should opt for will depend upon their specific circumstances. For instance, a multiple critical illness product can be more expensive and hence if funds are a constraint, one can purchase limited illnesses product, which are more affordable and still provide protection against the more prevalent conditions.
As is the case with fixed benefit critical illness products, there is a range of products available to choose from, such as accidental disability plans, plans which cover disability due to both accident and sickness and so on. This product is typically available at relatively low costs and can be taken as a stand-alone product or as a rider to an existing policy like a life insurance policy.
Buying health insurance products at a younger age will reduce the associated costs. In addition, health insurance products should have a longer tenure as they cover both the costs of treatment in addition to any associated loss in income. The cover should be purchased carefully, taking into account the income of the individual getting covered, broad costs associated with treatment of the health conditions or disabilities as well as the expected rate of inflation of these costs which is often higher than general inflation.
Overall, it is important for the customers to critically look at the above aspects so that the right kind of products are chosen at the right time and appropriate level of cover is purchased. This will ensure that they will be adequately covered if some an unfortunate onset of a serious health condition were to occur in their lives and the financial burden of these conditions will not impact them or their families allowing them to concentrate on the path to recovery.
The author is Appointed Actuary at Canara HSBC Oriental Bank of Commerce Life Insurance