Mr. Gerard Colaco: Health/Medical insurance is compulsory for all. Life and property insurance are optional, to be taken only if you need them and to the extent that you need them.
This must be compulsorily taken for the whole family. It should be taken even if your employers provide you with a family cover. The reason for this is that you can have job losses, or one or both of you may resign from your jobs. You may also consider migration or relocation to a different place or country. During these vulnerable periods, if you are afflicted with serious illness, you can be exposed to considerable financial stress at a time when you have no medical cover.
The advise you to take out a family floater health insurance policy in India. If by any chance you need to make a medical insurance claim when you are employed, ensure that the claim is made against your company insurance cover. However, have a ‘private’ family health cover to take care of situations when you may not have health insurance.
Furthermore, once you retire, you will cease to have health insurance benefits from your employers. When you are aged 58 or 60, you will find it extremely difficult and prohibitively expensive to obtain health insurance. However, if you can show a long track record of paying premiums regularly on your ‘private’ health policy, there is no difficulty in renewing and even increasing your health cover later on in life.
Let’s understand the difference between stand alone health covers or individual health covers and floater health covers with an example. Let us assume you want to take individual health covers of Rs. 1,00,000/- each for you, your wife and your child. Now, if only you have to make a claim for a medical problem of which the cost of treatment is Rs. 3,00,000/-, you will be reimbursed a maximum of just Rs. 1,00,000/-, because only Rs. 1,00,000/- has been taken on each individual.
However, in a family floater policy, any one member can utilize the entire cover of Rs. 3,00,000/-. Such flexibility is better. Floaters are available from most banks in India. To conclude, it would be advisable to take such an insurance cover for you, your spouse and children and renew it every year, hiking the cover every block of 5 years or so. Floaters generally cover a total of 4 members of a family. Premiums are quite reasonable.