The second Covid-19 wave has thrown life out of balance for all Indians. In this tunnel of uncertainty staring at us every waking hour, an adequate health insurance cover offers a ray of hope and security like nothing else.
Not that a health insurance plan was any less important before the pandemic hit us. It’s just that we perceive something only when we face it closely.
The smart way would be to learn from other’s mistakes and not commit the same yourself.
The obvious benefit of having a health insurance in the current situation is to protect yourself and your family from suffering any financial loss because of the contagious Covid-19 virus or any other hospitalisation.
But what if you do not have an existing health insurance? Chances are that you will have to liquidate some of your investments to pay hospital bills. Looking at high medical expenses that run into lakhs of rupees, it’s quite likely that a sizeable amount of your investments will go in a single hospitalisation. What if these investments were meant for your child’s higher education? Not only would you have hampered your current expenses, but also your child’s education goals.
Now imagine if you only have investments which are not liquid, like real estate, PPF (public provident fund), life insurance policies, etc, you might end up taking loans. You should be aware that interest on personal loans cost can be as high as 14-20 per cent.
In the worst-case scenario, you might not even get a loan, if say you have lost your job during the pandemic.
Is all this pain really worth it? Is it not better to buy a health insurance plan for yourself and your family?
So let us understand what you need to do. Firstly, if you do not have any health insurance cover, your priority should be to get a comprehensive one, not only for yourself but for all your dependents, including your spouse, children and parents. These plans mostly cover all types of hospitalisation expenses, including Covid-19 claims. It is suggested that you should opt for individual cover of at least Rs 5 lakh each. Looking at the soaring medical costs, Rs 10-15 lakh would be ideal.
In case you already own a health policy, check if it is adequate or not. If it covers just Rs 2-3 lakh, consider buying additional cover. You can opt for top up or super top up plans, with a deductible equal to your existing cover. It will be cost effective for you while at the same time enhancing your coverage.
If you already have an adequate comprehensive plan covering all family members, it is strongly recommended to additionally go for a critical illness plan. Consult a financial advisor who can help you select the best plan for you. The major advantage of having a critical illness cover is that these are benefit-based policies. This means the entire sum insured is paid to the policy holder on diagnosis of a critical illness, irrespective of how much is spent on medical treatment, which helps you cover non-hospitalisation expenses, which can be substantial.
Lastly, corona-specific covers are just like an add-on. If you have reached till this stage and have the first 3 points covered, you may go ahead and get one.
As the saying goes, prevention is better than cure. So, being healthy is very important. You can do it by improving your lifestyle i.e., having a balanced diet, exercising and sleeping well. Take all the precautions like using sanitisers and masks, and maintaining social distance. Also, be prepared financially by having a sufficient health insurance. Be calm and stay safe.
The author is a CA and Founder, Fintoo