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Is a high coverage of say Rs 50L or 1CR health insurance plan needed?

Rising medical costs have made it extremely important for every individual to opt for a medical policy. Ideally, you should insure your health before starting your investment planning. Medical policy can be taken from health service providers and it can cover your children as well as parents. Individuals who buy a health plan from the service providers (sum assured starts from Rs.2 lacs and can go up to 10/15 lacs) are always in a dilemma. The dilemma is that the sum assured could be insufficient in times of serious illness.
  • Serious illness (liver/kidney/heart transplant, brain tumor, cancer) is increasing at an alarming rate.
  • Hectic work culture and unhealthy eating habits increase the chance to make us prone to such illness.
  • The cost of treatment and the inflation associated with the medical expenses is increasing at a constant pace.
Advance technology and rapid research have given a boost to the availability of world-class treatment in good hospitals. But the cost of treatment is very high. High-value medical policies can save your pockets feel the pinch from such situations and ensure you remain financially relaxed in times of medical emergencies. For example, a liver transplant may cost you around 35-40 lacs. You might prefer taking treatment at a leading premier hospital to ensure that it is well equipped with the required treatment. In a city like Delhi, the room rent in premier hospitals will cost between Rs.6000-10,000 (ICU room will cost about twice or more than the room rent charges). Also, medicines for serious illness cost an upward of Rs.500/- per tablet and keep rising with the inflation rate. The good thing is some healthcare service providers have come up with high-value sum assured health policy. The sum assured of these health policies starts from Rs.50 lacs and goes up to Rs.1 crore. They have various benefits which are listed below:
  • Day care treatment
  • Health check-up at the time of renewal
  • Expert opinion on Critical Illness
  • Worldwide emergency medical cover
  • Health maintenance benefit
  • Ambulance coverage
  • Maternity Benefits
  • Newborn Cover
  • Vaccinations of newborn for the first year
  • Dental surgeries
  • Donor Expenses
  • Fewer restrictions on room rent limit
  • Premium not impacted by the claims made during the year
The benefits may be more or less depending upon different policies offered by various insurance companies. However, there are few disadvantages with high-value insurance policies. High Premium The premium of such policies is high when compared to a general medical policy which costs few thousands. The premium varies for different healthcare service providers and can also go above Rs.50,000/- per annum. Exemption under the Income Tax Act Under the income tax act, deduction of Rs.15,000/- (Additional Rs.20,000/- in case of dependent parents) can be availed in a financial year. Suppose you buy a high-value medical policy with a premium of Rs.48,000/-. So, there will be some portion which cannot be availed as a deduction. The only question is whether you can afford to take a high-value health policy. This is because of the high premium and the premium will increase every passing year adjusting it with the inflation and medical cost. Financial experts advise that in case you are not able to opt for a high-value policy, you can add a top up to your existing health policy which increases the sum assured up to a maximum of Rs.15 lakhs. Apart from this, you can start saving Rs.5-7 lacs for a medical emergency. You can use the emergency funds in case of minor health issues which will also keep intact your health policy sum assured. So, if you can afford one, you should opt for a high-value health insurance plan, otherwise, you can add top up to your existing health policy and keep aside an amount for a medical emergency.

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