Medical Insurance: Types and Policies

By | October 3, 2020
Medical Insurance

Medical insurance is a type of insurance coverage that typically pays for medical, surgical, prescription drug and sometimes dental expenses incurred by the insured. Health insurance can reimburse the insured for expenses incurred from illness or injury, or pay the care provider directly. It is often included in employer benefit packages as a means of enticing quality employees, with premiums partially covered by the employer but often also deducted from employee paychecks.  

Introduction

The cost of health insurance premiums is deductible to the payer, and the benefits received are tax-free, with certain exceptions. Health insurance policy is a binding contract issued between the insurer and an individual. Under the contract, the insurer promises to pay for health care reasonably required by the policyholder to treat illness or injury.

If the insurance policy is issued to an individual, the individual applies for the policy and pays the premiums either directly. Typically, in individual health insurance, the individual policyholder is insured. To extend the cover to the family, a family health insurance policy has to be obtained[1].

Types Of Medical Insurances

There are different kinds of health insurance arrangements accessible in India. These are grouped depending on the spread they give. The strategies are focused on each segment of the general public – individuals, families, only for senior citizens and so on. Comprehensively, the health insurance policy can be grouped in the accompanying classifications:

  1. Individual Health Insurance: This policy covers the health expenses and hospitalization expenses of individuals who have taken the policy. Premium under this policy is determined as per the age of insured.
  2. Family Health Insurance Plan: Under this policy, an individual can include all the family members against multiple diseases under a single cover. Family health plan offers a fixed sum assured for the family members, which can be availed by all members of the family or by anyone individual in the family.
  3. Senior Citizen Health Insurance Plan: This policy is designed for senior citizens or individuals over 60 years of age offering protection from health issues during old age.
  4. Surgery and Critical Illness Insurance Plan: This plan is suitable for the insured that requires treatment against critical illness, such as kidney failure, paralysis, cancer, heart attack etc. As the medical expenses of these treatments are very high, the premium applicable to these types of policies is also high.
  5. Maternity Health Insurance Plan: This policy covers costs, including pre and postnatal care, child delivery expenses of newborn babies. This policy is also covered for the newborn up to a certain period of time as mentioned in the plan. Ambulance costs are also covered.
  6. Personal Accident Plan: This policy covers hospitalization expenses in the event of an accident. Premium amount is depending upon the amount of cover taken.
  7. Unit Linked Health Plan: These plans offer a unique combination of insurance and savings both at the same time. This policy helps in building a corpus which can be used to meet those expenditures which are not covered by the insurance policy.

Kinds of Medical Insurances

As demonstrated over, a decent health insurance policy should give far-reaching inclusion. We have recorded beneath the key highlights of a decent health insurance policy. The advantages of health insurance strategies are detailed depending on the particular needs of the individuals, families and senior citizens.

These are ordinarily the inclusion given under generally individual and family floater plans:

In-patient Hospitalization: Medical expenses caused because of the hospitalization of any individual secured under the family health insurance plan are secured. The hospitalization ought to be for over 24 hours.

Pre-hospitalization Expenses: Before a hospitalization, expenses might be caused as a few tests must be led. These expenses are named as pre-hospitalization expenses. A family health insurance plan will take care of the expense of these expenses.

Post-hospitalization Expenses: Any medical expenses which might be acquired once the patient is released from the hospital are named as post-hospitalization expenses. In this way, if any demonstrative tests must be directed after release, the family health insurance plan will give inclusion to such expenses.

Hospital Cash: Several family health insurance plans give a day by day remittance if there should be an occurrence of hospitalization of the patient. This can be used to take care of the expense of the transportation or other fundamental necessities of the individual who is going to the patient hospitalized.

Daycare treatment: In a couple of cases, hospitalization may not be needed. The medical condition might be treated while time care remains in the hospital. For instance, waterfall surgery takes just a couple of hours. Strategies likewise spread for such daycare medicines.

Notwithstanding the above mentioned, different strategies likewise give an inlet to prior diseases. These diseases could be diabetes, hypertension, malignancy and so forth. This implies the backup plan is as of now mindful of the disease that a policyholder is experiencing. The inclusion accommodates any treatment of these illnesses. You can likewise get an independent basic disease policy. This health insurance policy gives spread against ceaseless diseases. Subject to the terms and states of the policy, regularly such a policy will give a singular amount sum acquired for the treatment of such condition.

Importance of Health Insurance Policies

Buying a health insurance policy for yourself and your family is important because medical care is expensive, especially in the private sector. Hospitalisation can burn a hole in your pocket and derail your finances. It will become even tough, if the person who brings in the money, is now in a hospital bed. All this can be avoided by just paying a small annual premium which would lessen your stress in case of medical emergencies.

A good health insurance policy would usually cover expenses made towards doctor consultation fees, costs towards medical tests, ambulance charges, hospitalization costs and even post-hospitalization recovery costs to a certain extent[2].

Significance of Health Insurance

Nowadays, in the middle of unhealthy living, busy life and unwholesome diet. Health-related conditions are not anything new. On the other hand, unforeseen illness or disease can cost you a lot more than you can imagine. It can make you lose all your lifelong savings in setting the hospitalization costs and medical expenses.

In such circumstances what brings you utmost relief and security is an ample medical insurance policy. Since medical health insurance plans are specifically designed in such a way to provide monetary protection against medical and hospitalization costs due to illness or diseases, you feel more relaxed. You no longer have to worry about the finances anymore when you are protected under a sound health insurance policy.

There are a number of health insurance companies in India from where you can instantly buy medical insurance plans online.

Peace of Mind: When you have health insurance, the policy will take care of the medical bills and medication expenses following any serious illness or diseases. You don’t have to pay anything from your own pocket unless you applied for any deductibles for the treatment. This brings your peace of mind since the treatment process will be continuing without any break due to cash crunch[3].

Health Care Schemes

The Indian government (center & state) have launched numerous medical insurance schemes to improve healthcare and make it accessible for the weaker sections of society Here is a list of health insurance schemes provided by the government:

Rashtriya Swasthya Bima Yojana (RSBY): This scheme was launched by the Ministry of Labour and Employment to provide health insurance coverage for families below the poverty line. The Beneficiaries under this scheme can avail a health benefits cover of up to Rs.30,000. A registration fee of Rs 30 is chargeable.

Pradhan Mantri Suraksha Bima Yojana: Is an initiative by the government to bring access to insurance especially for the economically weaker sections of society. This scheme features affordable premiums and provides compensation to the family of the deceased.

Central Government Health Scheme (CGHS): This scheme was launched in 1954. It provides comprehensive healthcare facilities to the central government employees, pensioners and dependents of these employees.

Aam Aadmi Bima Yojana (AABY): This is a social security scheme launched in 2017 to provide healthcare facilities for rural landless individuals. The head of the household or earning member of a family will be covered under the scheme (AABY). The beneficiary should be between 18 to 59 years of age. The dependent of the beneficiary will receive Rs.30,000 upon natural death, Rs.75,000 upon accidental death or permanent disability, and Rs.37,500 on partial disability.

Janashree Bima Yojana (JBY): This scheme was launched in August 2000. This scheme targets people falling below the poverty line (BPL) in 45 occupational groups covered under the scheme.

Employment State Insurance Scheme (ESIS): This is a social security initiative aimed at providing socio-economic protection to the working class and their dependents. The scheme ensures that all members and their family will receive full medical care from day one.

Universal Health Insurance Scheme (UHIS): The Indian public sector insurance companies have implemented this scheme to improve the access to healthcare for poor underprivileged families. Beneficiaries will receive reimbursement for medical expenses up to Rs.30,000 and accidental death cover up to Rs.25,000. The insurance premium for this scheme is Rs.200 per person, Rs.300 for a family of five, and Rs.400 for a family of seven.


[1]About health insurance and medical insurance, moneycontrol.com, Available here

[2] The importance of health insurance, Available here

[3] Gautam Sarkar, Significance of Health Insurance in Our Everyday Life, Available here


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Author: M. Preetha

Student: Saveetha School of Law

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