Need of Health Insurance: Top Reasons Why Term Insurance Isn't Enough

Buying insurance is always a wise choice, but you should know which type suits your needs best. Term insurance provides financial security to your loved ones in the event of your untimely death. On the other hand, health insurance covers medical expenses and protects the wellbeing of you and your family. Putting your money toward both life and health insurance is smart. It protects your family in all situations, even in your absence. 

In the last few years, healthcare costs have shot up quite a bit. [1] To make things worse, the world now suffers from sicknesses like COVID-19 [2] and black fungus. [3] These conditions amplify the need for buying health insurance more than ever. This is because treatment costs can be difficult to afford out of pocket. Health insurance addresses this problem, and offers aid in such times of uncertainty.

Read on to know more about the importance of health insurance and why there is a need for buying health insurance.

Importance of Health Insurance vs. Term Insurance: The Difference

• Health insurance

  Medical expenses are hard to predict and may surprise you. Even healthy people can suddenly fall sick. The present pandemic situation is a driving force for the need of health insurance. Most policies offer funding for medical costs, both planned and unplanned. Further, you can even buy a family floater plan to get coverage for a loved one as well. 

• Term Insurance

  Term insurance is one that financially secures the family in case the policyholder dies. It offers aid to families that lose a family member unexpectedly. Term insurance is always a smart way to protect your family. With term insurance, there are no policy maturity benefits. The policy is terminated if the insured survives the policy term. The premium you pay here is lower than other types of insurance. 

Additional Read: Important Health Insurance Parameters to Select the Right Plan for Yourself 

Benefits of Health Insurance 

• Comprehensive coverage 

Health insurance plans cover you against many treatment-related expenses. These include hospitalization costs along with pre-hospitalization and post-hospitalization expenses. You may also claim coverage for expenses such as radiotherapy, dialysis, and homecare treatment.

• Cashless facility 

When you avail of treatment at a network hospital, the entire process is cashless. Network hospitals are partners of your insurer. Once you raise a claim, the insurer covers the costs under this facility without requiring you to pay any cash. The alternative is reimbursement, where you pay the bill and the insurer reimburses you later.

• Portability provision 

• Protection against rising medical costs 

Having a health cover policy helps combat the rising cost of medical care. The comprehensive coverage protects you against many urgent healthcare spends. As such, you don’t have to worry about inflation and can focus on recovery.

• No claim bonuses 

This bonus is a reward given by the health insurer for not making any claims during the policy year. The bonus is offered on both individual and family floater plans. For every year that you do not make a claim, you can extend the coverage on your policy. There is a limit to this, but it a helpful provision.

• Tax benefits 

Health insurance policyholders get a tax rebate for the premium they pay. The Income Tax Act allows you to avail of tax deductions under Section 80D. [4]

Need of Health Insurance: Reasons to Consider Buying Health Insurance Policy

There are health plans for every person. Below are some medical policies that serve as reasons to buy health insurance.

• Individual health plans 

As the name suggests, these plans cover the treatment cost of a single individual. The policyholder receives the benefits for the premium paid. 

• Family floater plans 

Under such health plans, a family qualifies for coverage. The insured can include his/her spouse, children, and parents under the policy.

• Senior citizen health plans 

These provide funding for medical costs incurred by people above 60 years of age.

• Group health insurance plans 

These offer coverage for a group of people under a single policy. Such plans are mostly offered to employees.

• Critical illness plans 

These types of health plans are beneficial against the treatment of critical illnesses such as heart diseases, organ failure, or cancer. Treatment for such ailments is very high and health cover, which is why it makes sense to buy such a policy.

• Top-up health plans 

These are health cover plans that can be added to your existing health plan. Such plans provide you with extra coverage. 

As now you know the importance of health insurance, choosing the right plan also matters. For proper coverage, choose an offering with maximum benefits. You can find affordable health plans for you and your family on the Bajaj Finserv Health platform.