Are you wise enough to buy an insurance policy?

Kunal Parashar* (34) was thrilled with his life till two years ago. He had a high paying job that let him travel all over the world, a loving family and his own two bedroom house in Mumbai. “I thought my life was set, that I could retire in a few years and enjoy my family time. I was thoroughly unprepared for a sudden reversal of fortunes.”

Kunal was detected with a brain tumour after he complained of fatigue, memory lapses and severe headaches. “I thought it was related to the stress of my job. I took up yoga, sleeping on time and eating only home cooked food, but the symptoms remained. Finally, a round of blood tests and an MRI confirmed the prognosis,” he remembers. “But I was nonchalant about the surgery, since I had company health insurance. Imagine my shock when I realised that it would cover only a small part of my treatment!”

The decision to not take health insurance on time hit the family hard, as it grappled with Kunal’s treatment costs. “I had to give up my job because I needed long periods of time to recuperate. The tumour was a malignant one, which means that the cancer can recur any time. My savings were completely wiped out, and I am now contemplating selling my house to make some money available for my treatment,” he rues.

Don’t let your life’s story pan out like Kunal’s – invest in health insurance policies that cover the gamut of future medical and life expenses. It is one thing to not know if one has an underlying medical condition or if one is about to meet with an accident. But it is quite another to wilfully not prepare oneself for it with health insurance plans.

“My father met with an accident last year, and he was in hospital for a month,” says Ravi Mhatre* (33), Pune resident. “Thank God my wife had been urging me to take health insurance for months. I have a family health plan that paid for my father’s hospitalisation and treatment. I shudder to think what would have happened without insurance. I would be forced to borrow money from friends,” he says.

The good news is that health insurance in India is growing steadily, with many health insurance companies like Max Bupa offering excellent individual and family plans. These plans cover the gamut of medical treatments costs and also offer cashless hospitalisation cover. Other features include critical illness cover, daily hospital cash benefit and costs for diagnostic tests.  

When taking Health Insurance becomes Necessary…

What is the right time to take health insurance for oneself or for the family? Do it while you’re still young and in fiscal control.

Consider this scenario: you’ve just had a baby and the family’s expenses have suddenly doubled. Your wife is not holding a job at the moment, so you’re the sole breadwinner for the three of you. And then the worst thing happens – you fall ill and have to stay at home for at least two months.

In the two months that you are at home, considering that you went one month without pay and that you spent all your savings on your hospitalisation and treatment, did it occur to you that it made no sense to spend every rupee you had saved on your illness? In the days just after you had your baby, did you suppress the thought that if a sudden accident or disease struck you or your loved ones, you really had no backup payment options?

People such as yourself are ideal candidates for health insurance.

Investing for the future

Medical insurance is simply the corpus you set aside every month for future eventualities such as accidents and illnesses requiring hospitalisation and a long period of recovery. Instead of dipping into your current income or savings, this corpus helps tide over the crisis without affecting your life in any way.

Health insurance for hospitalisation relies on paying premiums in the present time so that a healthy corpus can be built for use in the future. Normally, people take medical insurance for the time that they need the policy to cover their hospital expenses when they are not working (such as in their old age) or for the time when a sudden accident necessitates their taking time off from work.

Medical insurance in India is, however, still largely in the nascent stage, with individuals opting for it only when an emergency looms on the horizon. However, the best time to take it is when you are in good physical condition – this helps the insuring company process your check up results and premium terms faster – and in good fiscal control. Normally, a higher return on the medical insurance plan will translate into a higher monthly pay-out; doing this when you’re still young and earning well will give the insuring company the confidence to process your application faster. The older you get, the more difficult it can become to take medical insurance.

However, some companies are offering health insurance even to senior citizens up to the age of 65 years, provided the premiums are being paid for a certain tenure and at a certain rate.