Corporate insurance is beneficial as an additional layer of protection, the most important component in protecting you from rising medical inflation is, in fact, an individual health policy.
Health emergencies are on the rise once more, and health insurance is a term that is frequently heard in these times. However, if we inquire, do you have health insurance? Counting only the corporate coverage provided by their employer, a sizable portion of the population would say yes. The statistics clearly show that the majority of people – as many as 50-60% of the working population – rely solely on their corporate insurance to deal with health emergencies. While it’s great to have corporate insurance as an additional layer of protection, the key ingredient to shield you from rising medical inflation is, in fact, an individual health policy.
In a post-pandemic world, a corporate policy alone is insufficient protection against huge hospital bills that often arrive unannounced. Any unfortunate emergency holds the potential to wipe out an entire family’s treasured savings in no time. This holds especially true in a country like India where insurance awareness is low and around 60 percent of people bear out-of-pocket hospital expenditure. Moreover, the most important factor is that one can exercise much more control and choice in individual policy as compared to corporate one.
Here’s capturing areas where depending only on the corporate policy can leave you with fragmented protection and how an individual policy covers those blind spots.
Low Sum Insured
Sum insured – the primary component of any health insurance policy – is of utmost importance while choosing a policy. The extent of coverage provided by the corporate cover can often fall short of adequately protecting you. The average sum insured offered in these policies can range anywhere from Rs 1 lakh to Rs 3 lakh. This range is very low, particularly given the spiraling medical inflation and occasional Covid waves.
Furthermore, according to Policybazaar.com statistics, 27 percent of customers get coverage of just Rs 1 lakh, and 8.5 percent receive coverage of Rs 2 lakh – which is disturbingly low as a standalone option. Given the current state of medical costs, it is strongly advised to get a retail health coverage worth at least Rs 10-15 lakh per individual. Furthermore, insurance with a large amount insured of Rs 1 crore are now accessible at an inexpensive monthly cost of Rs 1200. It is usually best to optimize one’s protection by purchasing enough coverage.
Coverage for family members
This is another critical area where a business policy may not provide a broad enough safety net for everybody. Many employer-provided insurance do not cover parents, despite the fact that they are the ones most vulnerable to a health crisis. Second, in certain cases, even the husband and children are not insured, leaving you vulnerable to significant financial burden. Do you know that a startling 69 percent of individuals take out insurance exclusively for themselves, while 30 percent include their spouse and children? There is a tiny population of less than 1% that includes spouses, children, and parents. Even after include family members, the quantity covered does not provide enough protection. This underlines the need of having a family floater or senior citizen health insurance to offer enough coverage for the family rather than depending just on company coverage.
Regardless of work level, being safe is essential.
We all know how the epidemic has impacted the employment market. Job losses and medical emergencies have become more common in the last two years. As a result, it is not advisable to rely solely on employer-provided protection at a time when job security is dwindling. Aside from that, if you decide to change jobs, retire, or start your own business, you will be exposed to massive medical bills if such a situation arises. It is critical to choose an individual policy to ensure your protection and that of your family, regardless of your employment status.
PEDs are covered.
We live in a world where health issues, including pre-existing diseases, are a grim reality for people of all ages. Unfortunately, the diagnosis of these diseases is a rude awakening, and obtaining a health insurance policy after contracting a PED may also become difficult. For example, if a person develops a liver, kidney, or heart condition, the insurers may refuse the policy entirely. As a result, it is critical to purchase health insurance as soon as possible, rather than waiting because you have a corporate policy. In fact, if you buy early, you can save a lot more on the premium.
Riders, or additional benefits obtained for an additional premium, form an important layer of protection over your policy. In contrast to corporate policy, where a standardized product is offered to all, individuals can customize their coverage and choose the riders that they require the most. Adding your preferred features may not be a viable option for the organization. However, add-ons like as coverage for domiciliary treatment, consumables, or OPD fees may drastically reduce one’s medical costs, particularly at a period like Covid.
Sub-limits and co-payments are examples of restrictions.
Corporate insurance often have a limit on either the money insured or the breadth of room rent coverage. In a policy, they are referred to as sub-limits and co-payment provisions. While co-payment requires the policyholder to pay a portion of the total hospital cost, sub-limit provisions require the policyholder to pay a portion of the room rent. With big spending, these constraints may put a strain on one’s wallet. For example, if your co-payment provision stipulates that you must shoulder 20% of the hospital charge, you would end up paying Rs 4 lakh if the total is about Rs 20 lakh. As a result, it’s not a good idea to rely only on company policy, since you have limited influence over terms and circumstances.