Health insurance for senior citizens is a significant topic of discussion in families, and many young adults doubt whether or not it is beneficial to buy individual health insurance plans for parents.
In India, we are very much used to the idea of having a tight-knit family. In many parts of the country, the finances of the entire family are inclusive. Seldom do we see a western formula of handling finances in Indian families. Hence, when it comes to buying health insurance policies for the family, there is a consensus amongst the different family members, and finances are handled accordingly. Most Indian families prefer having one health insurance policy for the family as opposed to individual covers. While this certainly is beneficial on various fronts, it also has severe limitations, especially in families with elderly members (members above the age of 60). Alternatively, you can choose health insurance for senior citizens.
While it might sound enticing to get a solitary policy covering your whole family, including your parents, it is vital to comprehend that this comfort includes some significant disadvantages. It is in every case better to get a different policy for your folks, and here’s the reason:
The fundamental idea behind a family health insurance policy is that a single sum assured for a single payment covers the entire family. When compared to obtaining separate individual insurance for each family member, these arrangements are less expensive and more sensible. This works exceptionally well when all of the people insured by the insurance are young and healthy, and the risk of several family members being hospitalized during the same year is low to none.
A health insurance policy for family can be a boon in multiple scenarios, but one must also try and look at the downside. Older members of the family who need care often shall use the benefits of the policy on a regular basis. While this is undoubtedly the objective of purchasing a policy, buying an individual policy instead of a family floater policy shall make sense here as the family floater policy can cover healthy individuals who don’t need health care services often and enjoy the benefits of the no claim bonus annually.
However, if your parents are at a higher risk of clinical difficulties, are also covered under the same policy, the sum assured may not be adequate to cover an emergency when another member of your family gets ill. However, this may not be enough with your parents, especially considering that there are greater chances of that total being used due to your parents’ age and physical condition.
Another distinct advantage of obtaining different coverage for your family is the additional tax breaks that health insurance provides. A separate deduction can be claimed on premiums paid for your family’s health insurance plans under Section 80D of the Income Tax Act. You can guarantee a benefit of up to Rs 25,000 for insurance that covers you, according to the agreement. Nonetheless, if you acquire separate insurance for your senior citizen parents, you may ensure an additional deduction of up to 50,000 INR, bringing the total accessible allowance maximum under Section 80D to 1 lakh INR.
All companies determine the policy premium based on the risk they need to cover. The greater the risk, the greater the amount of premium you must pay. While you obtain a health insurance plan for yourself when you are young, there is minimal risk for the guarantor because you are less susceptible to illnesses. Furthermore, there is a lower likelihood that you will have past diseases at that age. As a result of the decreased risk, the guarantor would provide you with coverage at a cheaper rate.
When you acquire health insurance for your loved ones, you should keep in mind that they are more susceptible to infections and may have pre-existing conditions. In such a situation, your policy’s premium would typically be greater.
Currently, the premium for a family floater plan is decided by the oldest component covered in such an arrangement. As a result, if you include your senior citizen parents in your health insurance plan for your family, your price will skyrocket. Thus, everything being equal, it is better to have a family floater plan for yourself, your life partner, and your children, and a separate arrangement for your parents.
There really is no question that you should obtain health insurance for your parents so that they may receive appropriate clinical care when they are most in need. However, if you have a choice between obtaining a separate individual arrangement for them and keeping them for your family insurance, it is typically better to go with the former. It not only saves you money, but it also allows you to choose the finest insurance for your specific needs.