After the COVID-19 pandemic, we have realised the importance of health and well-being. All of us are aware of the repercussions of a sudden illness, both physically and mentally.
In such conditions, a health insurance plan for family is crucial as it will cover all your family members under a single coverage amount. Read this blog to learn why a floater policy is the smartest investment in today’s world.
Why is a Floater Policy a Smart and Effective Investment?
Here, we will discuss why a floater family health insurance is an effective way to invest in your financial protection against unexpected medical emergencies. These include:
1. Cost Effectiveness
A family floater policy is more budget-friendly than buying individual policies for each family member. You will pay a single premium for a pooled sum insured, which is generally lower than the total cost of separate plans. This is particularly advantageous for nuclear families with younger members who have lower and less frequent medical needs.
2. Administrative Convenience
A single mediclaim policy for family simplifies the management of health insurance plans for each member. You just need to track one policy document, one renewal date, and deal with one insurer. This will save your precious time and reduce the effort of managing multiple individual plans.
3. Flexible Coverage
The shared sum insured in a family floater policy acts as a collective pool of funds that any family member can access in a medical emergency. This is beneficial because medical needs can vary, and if one member requires significant medical attention, the entire coverage can be used for them.
4. Tax Benefits
Premiums paid towards a family floater health insurance policy are eligible for tax deductions under Section 80D of the Income Tax Act. If you are under 60, you can claim a deduction of up to Rs. 25,000 for yourself, your spouse, and dependent children. Additionally, you can claim an extra deduction of up to Rs. 50,000 for premiums paid for parents who are senior citizens.
5. Option to Add New Members
As your family member grows, you can easily add new members to your existing family floater plan. Some policies even offer free coverage for a newborn for the remainder of the policy year. This feature makes it the best mediclaim for family, ensuring financial security during medical emergencies.
6. Cashless Treatment Options
Similar to individual policies, most mediclaim plans for the family provide access to a wide network of hospitals for cashless treatment. In an emergency, this allows you to receive medical care without having to pay upfront, as the insurer directly settles the bills with the hospital.
Also read, Tax Benefits of Critical Illness Insurance
What are the Factors that determine the Premium of a Floater Plan?
Let us look at what the factors are that determine the premium of a family floater plan:
- Age of the Eldest Family Member: If you include a senior citizen in your floater policy. Then the premium will be higher than policies covering younger family members.
- Sum Insured: A higher sum insured option provides better financial protection but can increase your premium.
- Number of Members Covered: Though a floater plan is generally cost-effective, the premium can increase with the number of family members included in the policy.
- Medical History: If any member has pre-existing medical conditions, such as diabetes or hypertension, the premium will likely be higher to account for the increased risk.
- Add-ons: Opting for add-ons like critical illnesses cover and a maternity benefit can increase the premium amount of the floater plan.
- Deductibles: Opting for a higher deductible can lower your premium.
- Renewal Discounts and Bonuses: Features like a No Claim Bonus (NCB), which reward you for not making a claim, can reduce your renewal premium.
Final Words
A mediclaim for family is an efficient solution for young, healthy families. However, for families with elderly members or someone with a chronic illness, an individual policy can be better. Additionally, it is important to understand that several factors are crucial for making an informed decision. Also, these will help you find a balance between adequate coverage and affordable premiums.