How much health insurance is enough.? A lot of people also ask for how much health insurance I need? Increasing medical facilities, robotic surgeries and changing lifestyle has made it compulsory to buy a health insurance plan. While buying health insurance plans, the coverage varies greatly from 2 lac to 50 lac to 1 crore also. The premium also increases as the sum assure increases. Therefore, the question arises about how much health cover you should buy.
Table of Contents
What is Health Insurance?
Health insurance is an insurance plan which covers medical expenses that arise due to an illness. The expenses covered are hospital bill, medicine bill and doctor consultation charges, nursing charges etc. However, monetary benefits from health insurance are not available. The actual bills are reimbursed.
Factor to consider before buying health insurance
While 5 lac cover might be sufficient for a person whereas even 10 lac will not suit others.
There is no ready-made answer to the question, however we will give you enough inputs to know the right insurance cover for you.
The right health insurance cover amount depends on many factors such as:
- city of residence
- Your current health status
- life stage
- medical history
- nature of job
- Type of hospital you need the treatment
- extent of coverage one can afford
How to decide the Health insurance cover amount?
Step1 City of residence
The medical treatment cost may vary from City to city, therefore one can make a rough estimate of a disease vs money required for treatment in a particular hospital.
Step2 Know your family medical history
Now check and try to correlate any family history. Know, if there is any family history for a particular disease. If yes, than try to take maximum cover as per the disease.
Step3. Group insurance cover
Before determining the quantum of health insurance required for you. You should also consider the benefits, which are already available to you like group insurance from your employer or any other kind of coverage from somewhere else.
Step 4.Think about future
You can start with a lower amount and increase the sum assured as the age increases. But I think, in today’s hectic life, one might forget to buy enhanced cover or cannot pay the premium of the high insurance at that time.
Do not buy the health insurance only thinking todays cost ONLY. Also consider future costs too. Since medical inflation is rising to the tune of 10%.Hence for a hospitalization of Rs 5 lac today may cost 20 lac down the lane in a span of 15 years. This may be the time when you require the health cover most but you cannot avail a new plan even by paying a higher premium.
Also read How to increase your health cover in a pocket friendly way.
Health insurance thumb rules
As such there ae no thumb rules but few basic points can be laid down to get the minimum amount of sum assured.
- It should be minimum of Rs 5 lakh
- It can be 50% of your annual income if your earning Rs 20 lakh in a year then you can consider at 10 lakh policy will be sufficient for you
- One way also to consider a sufficient cover that can take care of bills of any critical illness such as artery bypass kidney problems and any other severe disease.
If you can not afford to pay for higher sum assured than the other cost effective alternative is to buy a base health insurance plan and add a super top up plan. This way you can have a high cover pocket friendly way.
