Buying Health Insurance In India: An Insight

In India, when it comes to buying adequate health insurance cover, most people seem to follow the flock. Rather than looking at their individual needs and requirements, people generally buy a health insurance cover on the advice and guidance of their near and dear ones. A common habit of Indians while buying health insurance is standardising their policy with that of their family members or friends. No doubt, taking advice from the people you trust is always good, however, while buying something as important as a health insurance cover, it is important that you consider some important aspects that will help you in making an informed decision.

The healthcare costs in India are immensely high and are on a continuous rise in the last decade. And unfortunately, India is one of the least insured countries, with a health insurance penetration rate of only about 20%. Moreover, very few Indians are actually enrolled under a health insurance cover following, which the country is ranked amongst the world’s highest rates of out-of-pocket spending in the health care sector. As per a recent survey by World Health Organization (WHO), the public sector in India spent just 1.46% of gross domestic product (GDP) on health care. While the country takes pride in being the 6th wealthiest country with a total wealth of $8,230 billion and 5th largest defence spender with budget of $52.5 billion, lack of awareness around health insurance in our country is also at the top amongst other nations.

Something that is even more concerning is that even among the growing number of middle-class in India, for whom health insurance would be a worthwhile investment, very few people realise the value of health insurance. They fail to comprehend the fact that health insurance is a very important aspect as it helps them pay their unexpected medical expenses. A comprehensive health insurance cover helps insured customers spend less money overall as outpatients and enjoy a better quality of life.

According to a latest survey, there are numerous factors that people usually consider while buying health insurance. Brand name of the insurer plays an important role apart from factors like prices and claim settlement ratio. This is something, which policy seekers are not doing right. The most important factor to consider when planning to invest in a health insurance cover is the features and the extent of coverage.

On an average, whenever someone buys health insurance, the person compares available plans on the basis of the premium and chooses the cheapest one. Comparison of health plans only on the premium rate is never advised as there are the inherent features to consider. It is often observed that the cheapest plan provides limited coverage. One must know that each health plans has different features and when it comes to buying, you should compare the plans against their features and choose the plan accordingly. Though an agent may help you in buying a plan, you should not completely depend on him. Buying a policy online is way more helpful as you can compare the plans and claim settlement ration, choose the best features, and prices.

The common misconception is that, if we have a certain ailment, we should not disclose it while buying a health insurance plan for the fear of either the rejection or an increase in premium. Though you might be right about the consequences of hiding important medical facts, you are forgetting one thing. In case of a claim, if it is found that such facts were hidden, your claim might get rejected. You should disclose all relevant facts even though they might cause an increase in premium because that would at least ensure honouring of your claim.

It is important that the features alongside the premium should be compared while buying health insurance. A plan with add-ons and riders’ costs a tad bit higher but you must buy it so that all aspect of the hospitalisation expenses is covered. We think that once we buy a health plan, all our expenses will be covered without any exceptions. But, we are often wrong. Every health plan has a list of exclusions mentioned in the policy wording, that we tend to always ignore. These demand a look-over to know which expenses are excluded so that when the claim is rejected, you don’t feel cheated.

The author is the Head, Health Insurance at PolicyBazaar.com