January 30 , 2013
Most people are convinced about the fact that life insurance is a necessity but when it comes to health insurance many are inclined to think it is a just a good-to-have. But this is wrong since life insurance and medical insurance are mutually exclusive products. Both serve different needs.
Medical insurance is bought to pay contingent medical expenses. Life insurance pays a lump sum amount on death of the insured and serves no use as long as the person is alive. So to take care of hospitalization bills, which can come your way, you need mediclaim policy.
Health care is getting increasingly expensive and quality health care is not easily affordable for many. In the metros, being hospitalized for a week can easily rob you of lakhs of rupees. Unless you had a big enough contingency fund cushion you'd have to dig into your investments originally meant for other goals. And when it comes to long term investments, even seemingly small installments that you miss (because it went for hospital bills) can leave you with much lesser corpus due to the effect of compounding.
This is where a mediclaim comes handy. Since no one knows if and when they'd require hospitalization, everyone irrespective of whether they're earning or not ought to have a mediclaim policy. The earning member can buy a family floater policy and cover the entire family under a single policy. Any of the ones who are covered can claim reimbursement if hospitalized within the policy term, up to the extent of sum assured.
There is no need to scout for the 'best' mediclaim. All you need to look out for is that the policy has no sub-limits, for example on room rent, preferably has no premium loading clause and provides lifetime coverage. Use premium calculators available on insurance companies' websites and get the policy with cheap premium satisfying the above basic criteria. If you find the policy unsatisfactory you can port to another later on.
Since the probability of falling ill and getting hospitalized increases with age, the more you delay more expensive the premiums would get. Being adequately insured is one of the first milestones to achieve to be financially successful.