It works as a financial-protection tool against medical expenses.It usually provides either direct payment or reimbursement for the expenses associate with illness, injuries and hospitalization, as detailed in the scope of the policy cover.
The cost and range of protection provided by a health insurance policy depend on the insurer and the type of policy purchased by the policyholder.Some policies also cover Pre- and post- hospitalization expenses.
How it works
- You buy a health cover where the insurance company promises to bear the cost of treatment in the case of hospitalization and certain other situation upto a certain limit(the sum insured)
- You Pay an annual premium to the insurance company. The premium is dependent on your age, health condition and the sum insured.
- The insurance company either facilitates cashless treatment or reimburses the cost when medical treatment is required.
Types of Health Insurance
- Individual Health Plan
- Family Floater Plans
- ArogyaSanjeevani Plans
- Senior –citizen’s health Plans
- Group health Plans
- Critical- illness Plans
- Hospitalisation cash Plans
- Permanent total disability
Features
- Portability- Health insurance policies are portable, which means that one can move from one insurer to another by transferring one’s existing policies to a new insurer.It also transfers the benefits gained by the policyholder.
- Waiting period-Diseases that have been in existence before the policy commencement are usually covered only after continuing with the policy for certain number of years
- Cooling-off-period-This is the period when claims are not paid on the medical expenses incurred on the treatment of any healthrelated conditions occurring within this period, usually 30 days of the policy coming into force.
- Taxation
- Deductions of up to Rs 25000 from the taxable income under Section 80D of the Income Tax Act.
- Additional Rs 25000 deduction of upto Rs 25000 for paying premium of health insurance for parents.
- The deduction limit of Rs 25000 is enchanced to Rs 50000, in case the policyholder is a senior citizen.