Insurance is a pretty complex term and you are most likely to confuse between various similar policies when you are to buy one for your own self or your family. Since it is about you or your family members’ health, you cannot be taking much risk and quickly end up buying a family health insurance plan to ensure the safety of the individual member of your family.
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Well, things are not as simple and quickly resolvable as they may seem to you. You need to be very careful when exploring an insurer’s website, reading through various insurance policies’ terms. There might be several questions in your mind, such as whether you should buy an individual health plan or a single family floater plan to cover all your family members.
It is evident that there are numerous health insurance companies nationwide. Each of those companies has multiple variants of individual and family health plans, where each plan has its own pros and cons. Let us get things sorted out for you and help you choose the best health insurance plan for you and your family.
Before we proceed further, let us know a bit more about the difference between an individual and a family health plan precisely.
In case of an individual health insurance plan, the policy is issued in the name of the individual policyholder. Therefore, if you need all your family members to get the coverage, then you have to get different health insurance policies issued in the name of your individual family member. Simply put, the number of policies issued must be equal to the number of persons in your family. This ensures that every individual will have a dedicated sum assured under their respective health insurance policies.
On the other hand, the case of a family health plan is entirely different. To be precise, the insurance policy is issued to the entire family as a whole and the sum assured is be a single one for all, which however is unlike in the case of an individual health plan. This policy introduces the term Floater, i.e. the sum assured to be shared by all the members of your family.
For instance, if yours is a small family of 3, i.e. you, your spouse, and a kid, and have a floater plan with the sum assured of Rs. 4 Lakh, then all three members of the family are to share the coverage of Rs. 4 Lakh. In other words, your insurer has a total liability of Rs. 4 Lakh towards your family for the entire policy term of 1 year. Also, if anyone gets hospitalized due to a medical emergency, your insurer will take care of the expenses while there will be a direct impact on the sum assured. This also means that the sum assured will decrease for the other two family members as well.
An individual health plan for each family member certainly costs more as compared to a family health plan. Despite the cost, there are certain drawbacks of family health plans due to which individual health plans are recommended over floater plans. Below is a list:
The IRDA (Insurance Regulatory and Development Authority) of India, in its health regulation for 2013, had provided coverage for the gaps as we discussed above in point I and II. The regulatory has granted its permission allowing lifelong renewal of policies, where the premium is subject to the incidence rate and not the age of the senior most family member. Also, the credits earned over the waiting periods are to be carry forwarded if an insurer migrates one or more members of a family having a family floater plan to individual plans.
Well, the above changes by the regulators have done a good job letting individuals easily choose between a family health plan and an individual health plan, as one now has to consider the features of a plan while making their choice.
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Well, despite various pros and cons, family floater plans do have their own specific benefits too. The first benefit that you cannot ignore is that these plans spare you of the hassle of buying and then managing multiple health insurance policies, keeping in mind the renewal date of the individual policy, and so on. The second and the key benefit is that family floater plans are more affordable and are total value for money. These plans are the perfect choice for small families who are specific and tight on their budget, particularly on insurance spending. Furthermore, a floater plan is the perfect option to avail coverage for minors too, as individual health policies are not available for them.
After a thorough analysis above, it is evident that a family floater plan can prove to be a wise choice if made with adequate care, followed by a comprehensive, comparative analysis. Here is what you should be doing further:
Note: Even though you have to pay an additional premium since you’re buying multiple policies, the coverage will also be double and you can keep the NCB from being nullified even in case of a medical emergency.
The premium is the prime factor that influences an individual’s decision to buy a health insurance policy whether an individual or a family floater plan. However, you shouldn’t let your decision to buy a health insurance policy influence, as you have to carefully explore the features of various policies and make a wise decision. If you have found the above statement, i.e. individuals with health issues should buy individual health plans while kids and other family members to buy a family floater plan a good deal, then you should go with it. Buy your senior citizen parents individual health plans and make your decision the best deal ever.
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