Why Is Health Insurance Important in India Today?

Posted on: Feb 16, 2019 | | Written by: None

Why Is Health Insurance Important in India Today?

Importance of Health Insurance in India - Health insurance

Health problems and medical bills are rising fast in India, and even a simple procedure can be expensive. Therefore, it is wise to stay protected with health insurance for those uncertain times. It helps cover medical expenses so you and your loved ones can focus on getting better instead of worrying about money. In this blog, we will discuss the benefits and importance of health insurance in India.

Reasons Why Health Insurance Holds a Prominent Space in a Country Like India?

Living in today’s fast-paced world comes with increasing stress, leading to major health conditions, particularly among Indians. Millions of Indians suffer from heart disease and diabetes. Respiratory illnesses, birth complications, and infectious diseases are also widespread. One of the most effective ways to financially prepare for such health challenges is by availing a health insurance policy.

Low penetration of health insurance

Health insurance coverage in India remains limited despite gradual improvement. Estimates suggest that around 35–40% of the population has some form of health insurance, including government-backed schemes and private policies¹. A significant proportion of healthcare expenses are still met out of pocket, about 31% of hospitalisations in urban areas and nearly 47% in rural areas are financed through borrowings or the sale of household assets². High out-of- pocket medical spending continues to place financial strain on families, and studies indicate that medical expenses push roughly 3–4% of India’s population below the poverty line each year³.

These figures highlight that health insurance in India is still an untapped market. Many people lack awareness about what a health insurance plan is, how it works, and why it is important. As a result, individuals often deplete their lifetime savings or sell valuable assets to pay medical bills. Those below the poverty line may even settle for inferior medical treatment, further underscoring the urgent need for wider health insurance adoption.

Benefits of Buying a Suitable Health Insurance Policy

1. Financial stability

Emergency medical expenses may result in severe financial distress. You may have to dip into your savings or sell your assets to meet such expenses. When you buy a health plan, you are assured of financial stability during an illness.

2. Best treatment

You may have to compromise on the treatment plan in case of a health condition due to a lack of funds. With the best health insurance plan, you have the assurance of getting the best treatment to overcome a health condition.

3. Choice of insurance plans

Different insurance companies offer various types of health policies. Opting for the best health insurance available in India may be confusing. HDFC ERGO has a variety of insurance plans. You may avail of a plan that specifically caters to your requirements.

Make full use of health insurance to enjoy its benefits, because protecting yourself and your family from health issues is one of the best investments you can make.

4. Health insurance coverage

Insurance providers offer different types of plans to maximise coverage and benefits. Some of the coverage includes pre-and post-hospitalisation expenses, hospitalisation costs, daycare processes, and domiciliary treatment.

Here are the two most basic types of health insurance plans in India.

◦ Indemnity plans

These policies reimburse the actual expenses incurred for treatment. You can claim multiple times during the policy term, up to the sum insured. Typical expenses covered under indemnity health insurance include:

▪ Hospital room rent

▪ Operation theatre charges

▪ Doctors’ fees

▪ Medicine costs

▪ Pre- and post-hospitalisation expenses

Explore my:health Suraksha Insurance to see a detailed list of coverage and benefits.

• Lump-sum benefit (critical illness) policies

These plans pay a fixed sum assured if a covered event occurs. For instance, if the plan includes critical illness coverage and you are diagnosed with a listed illness, you receive the full benefit. These plans are designed to help cover expenses such as:

◦ Physiotherapy or rehabilitation procedures

◦ Monitoring devices required for critical illnesses

◦ Follow-up medical tests and investigations

◦ Dietary supplements

◦ Home modifications or ergonomic furniture needed due to illness

Explore critical illness insurance to see a detailed list of coverage and benefits.

Health Insurance Importance: Tips to Choose the Best Policy

Here are some tips to choose the right health insurance policy:

• Know your needs:

Everyone’s health insurance needs are different. Therefore, when you are choosing a plan, think about your health, family, and budget.

For example, if you are young and healthy, a basic plan may be enough. However, if you have a lifestyle-related condition, you may need higher coverage that includes pre- existing diseases.

The key is to understand why health insurance is important for you and choose a plan that best matches your healthcare requirements.

• Learn about the options:

Once you are clear about your healthcare needs, explore the different plans available. You can choose between an individual plan or a family floater, add useful add-ons, or even opt for co-payment to lower your premium. Knowing your options makes it easier to pick the right plan.

• Compare the benefits:

Check what each policy offers. It is important to choose a trusted insurance company and compare benefits to pick the plan that offers the most value.

• Check hospital network:

It is important to verify the list of network hospitals before choosing a plan. Pick an insurer whose network includes your preferred hospitals and doctors. It is also important to choose an insurer with a large hospital network so you can get cashless treatment easily.

• Check claim settlement history:

Choose an insurer known for settling claims smoothly and on time. This gives you peace of mind during medical emergencies.

Conclusion

Since medical expenses are high and emergencies can occur at any time, it is wise to stay covered and understand the importance of medical insurance for peace of mind and financial security. With insurance in place, you can choose timely and quality treatment without worrying about medical bills. Therefore, investing in a good health plan at an early age helps you stay protected against unexpected health and financial risks.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

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