Health insurance is popularly known as Medical Insurance or Mediclaim. It is a kind of agreement made between a person and an insurance company. It protects you and your dependents against any financial constraints arising on account of a medical emergency. It sometimes includes disability and long term medical needs. In Mediclaim you pay a premium and in return the insurer commits to pay a prearranged sum of money to meet the claims. Health insurance is new in Indian context and is slowly catching up with the consumers. Consumers recognize the objective of health insurance and it’s offering to cover the ever-rising medical expenses. Health insurance is sometimes used more generally to include insurance covering disability or long-term nursing or custodial care needs. It may be provided through a government-sponsored social insurance program or from private insurance companies.
Health insurance is obtainable to both individual and groups (e.g. by a firm to cover its employees). In each case, the covered groups or individuals pay premiums or taxes to protect themselves from high or unexpected healthcare expenses. However premium for an individual policy is costlier than that of the group policy. An individual is the owner of his personal policy. Whereas in group plans the sponsor is the owner of the policy and the registered members are enclosed by the policy. You can take benefit of group health insurance to overcome the shortage of individual insurance. People with no policy or are uninsurable due to one or the other reason can take good advantage of the group plans and be covered
By estimating the overall risk of healthcare expenses a routine finance structure such as a monthly premium or annual tax can be developed, ensuring that money is available to pay for the healthcare benefits specified in the insurance agreement. The benefit is administered by a central organization such as a government agency, private business or not-for-profit entity. The person or the insured should pay a regular fee called a premium to the insurance company. In return the insurance company will pay all or some medical expenses wanted when the insured becomes injured, ill, or otherwise hospitalized.
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Insurance can be defined as a risk-transfer mechanism that ensures full or partial financial compensation for the loss or damage caused by event(s) beyond the control of the insured party. Under an insurance contract, a party (the insurer) indemnifies the other party (the insured) against a specified amount of loss, occurring from specified eventualities within a specified period, provided a fee called premium is paid. Some of the basic types of insurance plans which give you tax benefit have been described below.
ULIPs Insurance Plan
ULIPs stand for Unit linked Insurance Plans. These are a type of investments which have the characteristics of both insurance and mutual fund. A part of the invested amount goes into insurance cover and remaining into an asset class. ULIPs usually have higher entry costs, brokerage and commission. The price of insurance cover is higher in a ULIP plan compared to a plain insurance policy.
Child Plan
These are the plans that provide cover to the life of the child’s parents/guardian/grandparents. These are term plans. These plans basically ensure that the child’s future is not put in jeopardy in case of death of the parent/guardian/grandparents of the child. Usually child plans are calculated to mature at important events in child’s life, like pursuing higher education or marriage. The sum is receivable irrespective of the survival/death of the insured.
Pension Plans
It is a plan that assures, one will continue to earn income and enjoy a comfortable life even after retirement. It has gained importance off late because of job insecurity, mid-career shifts. Mostly insurers provide two types of pension plans, endowment and unit-linked plans.
Term-Life policies
These are the kind of insurance contracts which cover the life of an individual over a period of time. The benefits will be paid if and only if the risk happens during the term of the policy.
Pure Endowment Plans
These are similar to term life plans. The basic difference is that the benefit will be paid if and only if the insured survives the term.
Endowment Assurance Plans
The best form of explaining this kind of a policy is that it is a combination of term life policy and pure endowment plan. This is a form of life insurance that assures one about the payment of a specified amount on a specific date or to the beneficiary upon the death of the insured before that date.
Money-Back Plans
These are ideal investment options for those who look for both insurance and savings. In these kinds of policies a certain percentage of the sum assured is remitted to the insured throughout the term of the policy. These remittances are tax-free. In case the insured survives the term, he receives the corpus with accrued options like bonus. In case of death of the insured before the expiry of the term, the nominee or legal heirs get the sum assured irrespective of the installments received, with accrued benefits.
Health (Med-Claim) Plans
This plan falls into the general insurance category. This basically covers medical expenses one may incur on account of illness and subsequent hospitalization. However, life insurance companies have started coming up with health plans.
We often buy insurance policies without analyzing the benefits. For instance insurance policies like endowment, money back don’t make good investment options because of;
Some policies appear to cost more, but may, in fact, be cheaper when you look at the overall cost of the policy. For instance, annual renewable policies increase your premiums every year and thus may appear to be more expensive than level term policies where the premiums never increase (even though the initial premiums for a level term policy will be higher). But, in fact, level premium policies might involve higher costs over the policy's full term, and become particularly costly when you try to renew your policy at the end of the term.
See Also: How to lower Health Insurance Premiums?
Quit Smoking :
The facts prove it: Tobacco users are twice as expected to die as non-tobacco users while they are insured. Insurance companies take this into account when they set their premium and cash benefits levels from the customers. You can save from 20% to 30% on premiums by stopping smoking.
Standard Vs. Preferred Risk :
Many insurance companies offer lower, preferred rates to people who appear to be in good health and live a lifestyle that promotes a healthy, accident-free life. If one is in this category, he/she may be able to get a much better deal on his/her life insurance.
See Also: Policy Details and Cost of Life Insurance
First-To-Die Policies :
First-to-die permanent life insurance policies pay cash benefits despite of which spouse dies first. Covering both spouses with one policy will be cheaper than buying two policies.
Consolidating Policies :
If one has a number of small life insurance policies, he/she can save money by consolidating their policies into one larger policy that offers the same coverage.
Shop for A Better Deal :
The best way to be sure that am I getting the best deal on my life insurance is to shop around. But it is important that you should do your shopping now while you are in good health, insurable and can meet the criteria for a good rate. Remember, the longer you wait, the older you will be and the higher your rates will be.
See Also: Different Types of Life Insurance Policies in India
Medical expenses has raised manifold in last few years. So it is very important to take a and the services provided are simulation of one another thus making choice difficult. There are some kinds of health insurance and they are follows :
Individual Medical Insurance
These types of medical insurance plans offer protection and indemnity on an individual basis. Insurance premium for individual plans are advanced than that for a group policy.
Group Medical Insurance
These medical insurance plans generally available through an employer or society or union are written on a number of people under a single master policy.
Special Plans
These plans are specially structured to suit the needs of elderly persons, veterans of military service, etc.
Health care expenses have seen a phenomenal rise in the recent times. This has led the customers to insure not only themselves but their family members also. It will cover future medical expenses and other connected requirements if it ever arises. The need to insure has gained more importance amongst older generation who is either retired or will retire in the near future. Let us discuss the types of medical insurances available in the market.
Medical Insurance
This is typically a hospitalization cover and reimbursement of the medical expenses incurred in respect of enclosed disease or surgery while the insured was admitted in the hospital as a patient. Different types of medical insurances are available in the market like individual medical insurance group medical insurance and overseas medical insurance. There are health policies that reimburse you the actual hospitalization cost for treatment of any disease and are obtainable by the non-life insurers only. These policies are popularly called Mediclaim policies. Other types of health insurances are provided by both the life and non-life insurers.
See Also: Advantages Of Buying A Health Insurance Plan
Critical Illness Insurance
Critical Illness plan insures you against the risk of serious illnesses in return of a premium you are necessary to pay. This gives you the same safety of knowing that a certain cash sum will be paid if the unexpected happens and you are diagnosed with any one of the critical illness. Sometimes a critical illness can change your lifestyle in adding to help within the home or the family. In this type of health insurance plan the insured receive a lump sum amount within a few days of diagnosing critical illness. Once this lump sum is paid the plan ceases to remain in force. Normally a critical illness plan would supply cover for the illnesses mentioned below;
Medical expenses are in sky high these days. A meeting with a doctor might churn out big bucks. The complicated medical treatment expenses could eat into your savings meant for the future. Health insurance policy kicks in to guarantee that you get the necessary treatment and your pocket is still under control. Having health insurance is significant because the coverage helps people get timely medical care and improve lives and health. It covers the risk of monetary difficulties in the event of long illness. The awareness has been enormous in the last couple of years. This must have been in response to the series of uncertainties people have observed in recent times like the terror attacks.
Benefit depends on the policy you choose and the coverage it provides. Here is a list of basic coverage provided by most of the health policies.
Following are the tips to note while taking a right health insurance policy
No one likes pay more than its worth. Getting the most appropriate and reasonable Health insurance is dependent on a few aspects like your choices, capability to choose and of courses the health conditions of the policy buyer. But by following a few steps you can save a good lot on your health insurance premium.
Below given table will help you to compare some of the good Health Insurance Products in the Market.
Company Name |
ICICI Lombard Insurance |
HDFC ERGO General Insurance |
Royal Sundaram General Insurance |
Bajaj Allianz Life |
Product Name |
ICICI Lombard Health Advantage Plus Plan |
HDFC ERGO New Health Wise Plan |
Royal Sundaram Health Shield Plan |
Bajaj Allianz Life Health Care Plan |
Medical Expenses (30 days prior and 60 days post hospitalization) |
Available |
Available |
Available |
Information not available |
Inpatient expenses* |
Available |
Available |
Available |
Available |
Day Care expenses for advanced technological surgeries and procedures * |
Available |
Available |
Available |
Available |
Outpatient Treatment Expenses* |
Available |
Available |
Available |
Available |
Pre-existing diseases |
It is covered after 24 Months of Continuous Coverage |
Information not available |
It is Covered after 4 Years of consecutive insurance |
Information not available |
Sum Insured |
Information not available |
Rs. 5,00,000 |
Information not available |
Rs. 10,000 |
Policy Duration |
1 Year |
3 Years |
Information not available |
Information not available |
Eligibility |
Age at entry 5 Years to 65 Years |
Upto the age of 55 Years |
Upto the age of 45 Years |
Age at entry 18 years to 57 year |
*Day Care expenses for advanced technological surgeries and procedures : Dialysis, Radiotherapy, and Chemotherapy, requiring less than 24 hours of hospitalization.
*Outpatient Treatment Expenses : Expenses related to Dental Treatment, Surgery, Anaesthesia, Operation Theatre Charges, Cost of Pacemaker, Cost of Artificial Limbs External Medical Aids, Dental treatment charges, Ambulance charges, etc.
*Inpatient expenses : Room charges, Doctors / surgeons fee, Medicines, diagnostic tests, etc.
Taking health insurance and paying premium is one story and filing for claim is another. Claiming benefits can be quiet tricky at times so you have to be smart and careful while filing for the claim. To file a Health Insurance claim with your Insurance Company you have to keep the following things ready.
From the time taxes have come into existence there has been a constant struggle between the tax collectors and tax payers. The collectors want to collect more taxes so that the government will have more money to invest in the developmental works, and hence improve the economy on the other hand it is us or the tax payers who want to reduce the tax liability. The government gives deductions and tax exemptions for some of the investment done by the assessee to encourage him to invest in some of the businesses. Earlier on the Tax laws were stringent and the provisions were not lucrative enough to drive people to invest keeping tax planning in mind.
With the amendment of Income Tax Act and the passage of time, there seems to be a dramatic improvement in the investment options available to save tax. Insurance has always been viewed as an investment and a tax saving tool. One major mistake we all do is to plan for tax saving only towards the last quarter of the financial year, and thus, we end up taking many investment decisions in haste.
Therefore assessing each option carefully and then choosing the right investment plan has become pivotal in making tax saving a profitable exercise. Insurance is one such tool. If any person knows the benefits under the Income Tax Act, Tax Planning will be much simpler activity.
Any tax payer can invest upto Rs. 150000/- in EPF, PPF, life insurance premium, NSC, infrastructure bonds, pension plan premium, tax saving mutual funds, home loan repayment without any sub limits. Earlier on tax laws did not provide for exemption on premiums paid towards pension plans. However, the current provisions cover that also, hence, retirement planning has also become an interesting investment option.
Section 80D
Amount paid towards the premium of med claim insurance policy by an assessee can be claimed for deductions under this section.
The deductions available under this section are;
Section 80DD
In case of premium paid for medical treatment of disabled dependent, an exemption of Rs.75000/- is available and an exemption of Rs. 1,25,000/- in case of severe disability.
Section 10(10D)
Any sum received as profits from the policy are exempt and the sum assured one receives is also exempt. Any amount an individual receives is exempt from tax as benefit from the insurance policy
Section |
Benefit up to |
Section 80C |
Rs.150000/- includes premium paid on life insurance and pension plans |
Section 80D |
Rs.25000/- towards payment of premium on medical insurance plans on self and non senior citizen dependents. An additional deduction of Rs.50000/- towards payment of premium on medical insurance plans of senior citizen. |
Section 80(DD) |
Upto Rs.75000/- on premium paid for covering the medical insurance of disabled dependent and Rs.125000/- in case of severe disability |
Section 10(10D) |
Any profit or sum assured received is exempt |
Some tax planning tips to sum up the article would be:-
Many investors feel tax planning is little more than a compulsory business activity to save tax. Tax planning is a lot more than blindly applying to insurance policies. Tax planning has to be an activity that contributes to personal financial goals as well as reducing the tax liability. Tax planning has to be taken up as a continuous activity rather than a onetime affair.
Human body is prone to diseases. Nobody can say “yes i cannot get sick”. Even Baba Ramdev can get sick. A common man works hard all his life for what?? He earns for his livelihood, for his families dreams, for his child’s dreams, for a better standard of life. BUT what if after working hard for whole of one’s life one has to spend all that money for his medical treatment, all give it to hospitals just for the sake of breathing. All happiness vanishes once for all. The whole lifetime fortune just goes like that for medical treatments. BUT, why not spend little now to get spared from making huge payments at the time needed and let the dreams come true. This brings in the concept of HEATH INSURANCE SECTOR. The question arises WHY IS NOT HEALTH INSURANCE COMPULSARY AND MAKE MEDICINES FREE IN INDIA. It is there in western part of the globe, and that is the reason people there have no fear on their faces in old age too. Why not get insured and enjoy the facility of standard quality medical treatment in our country instead free substandard treatment in municipal hospital.
Health insurance is a risk covering document to provide financial aid against the risk of unforeseen health expenditure. It’s simple health insurance is an insurance policy on which one has to pay a reasonable amount of premium any in any event of sickness, this health insurance provides financial aid for the treatment.
Over the large 50 years India has developed much awareness and has been successful in improving the health status. The death rate, infant mortality rate etc have certainly been reduced and during the course of time the life expectancy has increased from about 35 to 65 years. Still there are many challenges which include high incidences of the communicable as well as non communicable diseases, neglect of women’s health, variation in regions and of the environmental threat. A recent survey result shows that 60% people use private health providers for outpatient treatment while another 40% rely on government providers only. The average expenses incurred in private sector is 2-5 times more than in public sector.
See Also: Health Insurance Benefits
On considering the GDP of our country private health care expenses is 4.25% out of 6%, the total expenditure on health. But still the insurance is considered to be negligible. Public funding is mainly on preventive, and primary care programmes but private sector concentrates mainly on curative care. There has been a considerable increase in number of private doctors and private clinical facilities, in addition to these there are many hurdles arising in Indian health financing which are :
Thus having a view of the above data it is very difficult for health financing options. Health insurance, hence, is considered to be as one of the financing mechanism to overcome the problem and stay health.
See Also: Best Health Insurance Plans in India
There are many health insurance companies in India. Every company offers various products. Some are for specific illness, some are only for hospitalization and on top of that most of them are having hidden terms and conditions. Here INDIANMONEY.COM plays a predominant role in helping you in selecting the best health insurance policy among the various available in the market. Indianmoney.com is a free financial advice provider which can help you in selecting the best health insurance policy as per your individual requirements.
Health insurance may be available at cheap rates if you are healthy but make sure that you purchase a policy which meets your needs. Look out for the deductibles, co payments and sublimits in your health insurance policy.
Make use of health insurance portability if you are not satisfied with your health insurance policy.
India suffers a serious mental health crisis, with more than 5 Crore people suffering from depression. Nearly 4 Crore people suffer from anxiety disorders. Mental illness can lead to depression and suicides, costing India crores of rupees. Sadly, not much attention is paid to mental health which is costing productivity and employee well being.
Why is mental illness ignored in India? It’s commonly believed that speaking to a mentally ill person affects your mental health. IndianMoney reviews say people keep mental illness secret, fearing job loss. They are reluctant to discuss mental health and seek a cure.
What is mental illness? It’s a wide range of mental health conditions and mental disorders, which affect mood, thinking and behavior. Mental illness includes depression, anxiety disorders, schizophrenia, eating disorders and addictive behaviors. Mental illness makes a person miserable, affects work life and relationships and causes problems in daily life.
Depression: Depression can occur at any age, to any gender and practically anyone. It leads to loss of interest in activities and pleasure, affecting work life and productivity. Symptoms could be fatigue, weight loss, eating disorders and low energy levels. Guilt, difficulty in concentration and wrong decision making, follow. Suicidal tendencies and feeling of worthlessness must be looked into, on priority.
Anxiety: Anxiety could be palpitation, restlessness, apprehension, nausea, trembling and breathlessness as reactions to stressful events. Anxiety induces an increased use of sleeping pills, drugs and alcohol. Difficulty in concentration, loss of control, fatigue and sleeping disorders affect productivity.
Schizophrenia: Hallucination, disorganized thinking and delusions are the symptoms of Schizophrenia. A delusion is a false belief which persists in spite of contrary evidence. There’s a feeling that people are constantly plotting and you are the target.
What are the treatments for mental disorder?
The Parliament passed the mental Health Care Bill 2016, with provisions for state health care facilities and rules which uphold the rights of mentally ill people in India.
1. Access to affordable healthcare for mentally ill
A person with mental illness in India has the right to good quality and affordable healthcare. No discrimination can be made on the basis of gender, religion, caste, socio-economic status or political beliefs.
2. Power for consent and decision making
People with mental illness can make decisions regarding health and treatment, if they understand treatment and consequences. They cannot be forcefully admitted to hospitals, if they understand what’s happening to them.
3. Right to live in a community
People with mental illnesses enjoy the right to live in a community and cannot be segregated from society. The Government will provide legal assistance and support to help mentally ill people live a normal life.
4. The right to confidentiality
A person with mental illness doesn’t have to disclose illness or treatment to anyone. The media cannot publish information without individual’s consent.
5. Rules on prohibitive practices
Electroconvulsive therapy or shock treatment cannot be performed without muscle relaxants and anesthesia. Patients cannot be sterilized, chained or abused in any manner. Patients have the right to wholesome food, privacy and facilities of leisure.
6. Decriminalization of suicide
Suicide is not a criminal offence. Survivors of attempted suicide would be considered to be under severe.
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