Health Insurance - Health Insurance Plan in India | Kotak Life (2024)

What are health insurance plans?

Health insurance plansare a type of insurance coverage paying for health-related expenses. It can cover the costs of medicines, surgeries, hospitalization, day-care procedures, critical ailment treatments, and other medical expenditure the policyholder incurs.

Due to escalating healthcare costs, proper treatment for medical conditions can dent your savings. Also, when a crisis arises, unless you have the funds at hand, arranging for timely medical assistance can be challenging.Health insuranceprotects you from such financial strains. It ensures access to quality healthcare.

Importance of health insurance plan in India

Ahealth insurance planis essential in India because of escalating medical care costs. Medical inflation is increasing at double the rate of overall inflation. According to the Government’s 2018-19 Economic Survey, the average retail healthcare inflation rate is an alarming 7.14%.

Moreover, in India, the burden of lifestyle disorders is also growing.

Chronic health conditions such as heart problems, cancer, and liver diseases, need long-term follow-up therapies. Studies show that 85.42% of Indian households facing economic instability due to health expenses have a critical illness in the family

Unfortunately, in the matter ofhealth insurance, Indiais underinsured. As per the National Sample Survey (NSS), over 80% of Indians do not have health insurance. The Insurance Regulatory and Development Authority of India (IRDAI) says that out-of-pocket spending on medical care is 64%.

The lack ofhealth insurancecauses Indians to dig into their savings, sell assets, or take loans to pay for medical expenditure.

Therefore, if an unforeseen medical concern crops up, the cost of hospitalization and adequate treatment can derail finances. The situation becomes more complicated if the person whose earnings sustain the household loses their income due to ill health.

Paying the small premium for ahealth plan insurancecan help you avoid such financial uncertainty.

Why should you buy a health insurance plan?

From luxury expenses like foreign holidays to necessary expenditures like children’s higher education, the need for funds are many. Effective arrangement for such funds necessitates planned investments. However, you may have to spend a large portion of your income on basic amenities and immediate needs. It may leave a very little surplus for future requirements. Therefore, financial experts advise that before you consume your entire salary on day-to-day expenses, you should set aside a sum for the future.

The problem arises when the amount that you can save regularly is small in comparison to the funds that you may need later. Herein lays the need for wealth building, which grows the money you put aside.Amoney-saving planhelps in increasing your savings over time so that enough capital accumulates when the need for funds arises. Here’s a look at reasons for buying such plans.

  • Provides financial security
  • Medical emergencies arise unannounced. But the cost of quality healthcare is steep. Paying for the treatments from your savings can force your family to compromise with their living costs. Your children’s education or retirement funds can get affected.

    Ahealth insurance policycovers most medical expenses, such as:

    • Diagnostic tests
    • Doctor’s consultation charges
    • Hospital bills
    • Medicine prices, chemotherapy costs
    • Ambulance charges
    • Pre and post hospitalization

    Thus, you can access appropriate treatment on time without risking your loved ones’ financial wellbeing.

  • Enables you to fight critical illnesses
  • Diseases like heart attack, stroke, liver damage, and nerve disorders are widespread these days. Sedentary lifestyles, poor eating habits, stress, and pollution have led to an increase in such diseases even in the youth.

    Critical illness insurancepolicies reduce your financial worries for the treatment of such medical conditions.

  • Helps you get the best treatment
  • Most insurers reimburse costs incurred even when you undergo treatment in any hospital not having tie-ups with the insurance company.

    Also,critical illness insuranceallows you to undergo treatment at any hospital you prefer. You can use the upfront lump-sum payout in any way you choose.

  • Covers hospitalization expenses
  • All medical expenses may not be covered underhealth insurance plans. But you can opt for a daily hospitalization cash benefit with your base plan. It pays a fixed sum for each day of hospitalization. You can use the sum as per your need, covering extra costs excluded from your health cover

  • Acts as income replacement
  • Manymedical policiesoffer regular incomes on the diagnosis of the diseases covered under the policy. Thus, your insurance policy serves as a livelihood if you need to take a career break due to poor health.

  • Takes over future premiums during ill health
  • Insurers offer premium waiver if your earnings suffer and you fail to pay your premiums due to failing health. Your policy stays in force.

  • Provides a safety net against accidents
  • Somehealth policyproviders offer accident coverage, paying a lump sum in case of death or disability due to accident. The payouts provide financial relief to your family in their hours of need

  • Protects your family’s health
  • You can include your family members under your health plan, ensuring their speedy recovery with your health cover’s financial aid.

  • Reduces income tax
  • Health insurance premiums are deductible from your taxable income under Section 80D of the Income Tax Act, 1961. The payouts are also tax-free. Thus, buying amedical insurance plancan help you save on taxes. The table below displays the available tax deductions:

    Members CoveredTax DeductionsTotal Tax Exemption
    Self and parents below 60 years of age₹25,000+₹25,000₹50,000
    Self below age 60 years and parents above 60 years ₹25,000+₹50,000 ₹75,000
    Self and parents both more than 60 years old ₹50,000+₹50,000 ₹1,00,000
  • Arranges for transportation in medical emergencies
  • Illness or injury can strike when you are away from the scope of proper medical care. Your insurer can organize the transportation and equipment needed for the transfer to a reliable medical facility. Also, when your health condition becomes stable, your insurance partner arranges for your return home under medical supervision.

Important Features and Components of a Health Insurance Plan

The notable components of amedical insurance planinclude:

  • Sum insured:The maximum amount you can claim against your medical expenses or the maximum payout the insurer guarantees on the detection of diseases covered.
  • Premium:The amount you pay to your insurer to enjoy the health cover, either at one go or throughout the policy period
  • Policy period:The duration through which your health cover remains active, and you can raise claims for health issues covered
  • Network hospital:Hospitals having tie-ups with your insurance companies, allowing cashless treatment on admission
  • Cashless treatment:Hospitalization without having to pay the bills yourself, on admission to the insurer’s network hospitals
  • Deductible:The amount you must pay from your resources before your insurer starts paying their contribution towards your medical expenses
  • Co-payment:The fixed percentage of medical bills you agree to pay yourself while the insurer pays the balance, effectively reducing the payable premium
  • No Claim Bonus:Increase in sum insured during policy renewal at no extra cost as a reward for a no-claim policy year
  • Daily Hospital Cash Allowance: Lump-sum amount paid for each day spent in the hospital subject to a minimum hospitalization period
  • Critical illness cover:Medical insuranceagainst life-threatening, non-infectious health conditions, offering lump-sum payouts on diagnosis
  • Policy lapse:Termination of health covers on missing premium payment on time
  • Grace period:Timeframe the insurer permits for delayed premium payment after renewal due date before policy lapse
  • Waiting period:Time-gap from the policy start date before insurers start paying for claims
  • Policy revival:Reinstating yourhealth policy, allowed within five years from the date of due premiums

How do health insurance plans work?

Ahealth insurance policyis an agreement between you and your insurance provider. You agree to pay a fixed premium. In exchange, the insurer promises to pay for the healthcare costs covered under your plan, arising during the policy period.

Health insurance can be classified into two categories:

  • Mediclaim or indemnity medical policies
  • These policies pay the treatment costs up to the sum insured when you are admitted to a hospital. The amount paid depends on the actual expenses. You need to submit the hospital bills.

    If the hospital is listed under the insurance company’s network, the insurer will directly settle the bills with your hospital. You need not bear any expense.

    If you have to get admitted to any hospital outside your insurer’s network, you have to pay the bills yourself. The insurance company will later reimburse the expenses subject to your policy’s terms and conditions. But treatments at hospitals outside India are usually not included.

  • Critical illness insurance plans
  • Such health plans cover specific life-threatening ailments that often need prolonged treatment and regular check-ups. Examples of such non-infectious lifestyle diseases include heart attack, stroke, liver damage, and cancer.

    These fixed-benefit policies provide a pre-decided lump-sum payout upfront on the first diagnosis of the listed diseases. You need not submit any medical bills. A medical test report proving the diagnosis suffices.

The payouts are based on the cover you choose and not on the actual expenses. Thus, you are free to undergo treatment from any hospital of your choice, even abroad. The monies help you meet costs such as

  • Doctor’s fees
  • Follow-up health check-ups
  • Medicines and dietary supplements
  • Physiotherapy and other rehabilitation treatments
  • Monitoring devices

You can also use the payout to fund your family’s living costs, EMIs, your children’s education fees, and more.

Who should buy health insurance plans?

Health insurance plans are a necessity today. The coverage opens the gates to quality medical care regardless of your family’s resources.

Therefore, if you have started earning, and want to protect your finances against rising healthcare costs, you must buy health insurance. You will stay financially prepared and free from anxiety in a health-related contingency. It can also maximize your tax savings.

How much health cover do you need?

The amount depends on the following parameters:

  • Age:At a younger age, you can settle for lower coverage. But health complications increase with age, increasing the chances of ahealth insuranceclaim. Hence, as you become older, the premiums also become costlier. However, with specific health insurance types like critical illness covers, regardless of age, the premium remains fixed. Thus, it is advisable to buy a sizeable coverage even at a young age.
  • Health:If you do not suffer from any health condition, low coverage might be acceptable. But with health issues like obesity or hypertension, odds of lifestyle diseases increase.
  • Also, even if you are healthy, look into your family’s medical history. Some diseases like diabetes are often hereditary and lead to complications like liver damage later. It is better to secure coverage against such ailments in advance.
  • Budget: An expensive medical policy that eats into your earning defeats the purpose of health insurance - safeguarding your finances. Hence, buy coverage with a premium you can service throughout the policy term.
  • What are the different types of health insurance plans offered by Kotak Life?

    Kotak Life offers a fixed-benefitmedical insuranceplan,Kotak Health Shield. It covers both early and major stages of cancer and life-threatening medical conditions related to the heart, liver, and nerves.

    On the diagnosis of the illnesses covered under the plan, you receive a lump-sum payout without the need for hospital bills. The policy also provides financial protection against death or permanent disability due to an accident.

    The affordable premiums start from ₹300 for ₹10 lakhs sum assured.

    You can select one or more from the following covers:

    • Cancer Shield
    • Cardiac Shield, including pacemaker implantation, angioplasty, open heart bypass surgery, heart attack
    • Live Shield, including liver cirrhosis, viral hepatitis, liver transplant
    • Neuro Shield, against coma, paralysis, stroke, brain tumour
    • Personal Accident Shield, covering an unfortunate demise or disability from an accident

    You can also include your spouse under your plan and select add-on benefits such as:

    • Daily hospitalization cash allowance
    • Waiver of premium on the diagnosis of specified health conditions
    • Monthly income benefit at major stages of the diseases covered

    The policy provides an all-round solution for your healthcare needs through in-built wellness benefits such as:

    • Option for second medical opinions
    • Option for second medical opinions
    • Medical repatriation to your homeland
    • Medical repatriation to your homeland
    • Medical monitoring of treatment

    Anyone between 18 and 65 years of age can avail of thishealth insurance plan.Coverage remains active up to the age of 75 years.

    How to buy the best health insurance plan for your family?

    While choosing a health insurance plan, you need to weigh in the following factors:

    • The right policy type:
    • Assess your healthcare needs. If your family members depend on you financially, you need health covers for them too. However, including elderly parents in family floater plans can make the premiums costly. The price depends upon the age of the oldest member covered. Hence, picking a joint cover for yourself and your spouse, buying separate plans for your parents could be cost-effective.

      Also, if your health status or family’s medical history increases the risk of lifestyle diseases, consider buyingcritical illness insurance

    • The coverage amount:
    • Select a plan that offers comprehensive coverage as per your age and health.

      Also, if your profession involves working in hazardous conditions or frequent travels, an accident protection shield could prove valuable.

    • Premium rates:
    • Choose plans that provide the coverage you need at premiums that suit your budget. Also, select a premium payment frequency matching your cash inflow.

    • Policy term:
    • Need for health insurance increases with age. Buy a plan featuring a long policy term to enjoy coverage in your old age.

    • Add-on benefits:
    • For a nominal premium hike, you can extend your base cover to include:

      • Daily hospital cash allowance for expenses excluded under your plan
      • Premium waiver in case of inability to continue paying premiums due to poor health condition, keeping your cover active
      • Regular income to replace your earnings lost due to ill health, providing your family’s living expenses
    • In-built features:
    • Medical emergencies might need a quick transfer to suitable medical centres. If you fall ill away from home, you may need assistance to return. A family member’s presence during your illness could be invaluable. Opt for a plan that provides such useful facilities as a part of the base cover.

    • Exclusions:
    • Read the fine print carefully to understand if any expense is not covered under the plan. Compare brochures forhealth insurance onlineto locate the best offering.

    • Hospital network:
    • The extent of the insurer’s hospital network is the key to accessing medical care anywhere in India. However, when buyingcritical illness insurance, this need not be a concern since you can undergo treatment wherever you choose.

    • Insurer’s credibility:
    • A high claim settlement ratio (CSR) indicates a greater probability of your claim being honoured. For example, Kotak Life, scoring a CSR of97.4%in FY2018-19, enjoys a long-standing reputation as a reliable insurance provider.

    Documents required to buy a health insurance plan

    • Identity proof:Aadhaar Card/ Passport/ Voter Card/ Driving License/ PAN Card
    • Age proof:Birth Certificate/ Passport/ Driving License/ Voter ID/ 10th or 12th class board examination mark sheet
    • Residential address proof:Aadhaar Card/ Passport/ Voter Card/ Driving License/ Ration Card/ Utility bills for electricity or telephone
    • Passport size photo

    Conclusion

    In India, the cost of medical facilities is skyrocketing. You would not want your family to suffer from monetary shortfalls due to a medical crisis. Hence, financial preparedness is vital to avoid burning a hole in your pocket due to medical emergencies.

    Buying a health insurance plan with an adequate sum assured helps you avoid financial shortfalls in medical emergencies. Moreover, life-threatening medical conditions are rampant these days.

    Kotak Health Shield provides financial cover against the most common non-communicable diseases in India at affordable premium rates. Invest in this health plan and remain stress-free about the financials in case of a medical contingency.

    Reasons to Choose Kotak Life for Your Savings and Investment Plans

    Kotak Life offers a fixed-benefitmedical insuranceplan,Kotak Health Shield. It covers both early and major stages of cancer and life-threatening medical conditions related to the heart, liver, and nerves.

    On the diagnosis of the illnesses covered under the plan, you receive a lump-sum payout without the need for hospital bills. The policy also provides financial protection against death or permanent disability due to an accident.

    The affordable premiums start from ₹300 for ₹10 lakhs sum assured.

    You can select one or more from the following covers:

    • Cancer Shield
    • Cardiac Shield, including pacemaker implantation, angioplasty, open heart bypass surgery, heart attack
    • Live Shield, including liver cirrhosis, viral hepatitis, liver transplant
    • Neuro Shield, against coma, paralysis, stroke, brain tumour
    • Personal Accident Shield, covering an unfortunate demise or disability from an accident

    You can also include your spouse under your plan and select add-on benefits such as:

    • Daily hospitalization cash allowance
    • Waiver of premium on the diagnosis of specified health conditions
    • Monthly income benefit at major stages of the diseases covered

    The policy provides an all-round solution for your healthcare needs through in-built wellness benefits such as:

    • Option for second medical opinions
    • Medical evacuation from areas lacking healthcare facilities
    • Medical repatriation to your homeland
    • Compassionate visit of a relative during illness
    • Medical monitoring of treatment

    Anyone between 18 and 65 years of age can avail of thishealth insurance plan.Coverage remains active up to the age of 75 years.

FAQs

  • What is Health Insurance?

  • What is Kotak Health Shield?

  • What are the top benefits of health insurance?

  • What are the tax benefits of health insurance?

  • Is a medical test compulsory to buy Kotak Life plans?

  • Which illnesses are covered under Kotak Health Shield?

    Related Insurance Plans

    • Health Insurance - Health Insurance Plan in India | Kotak Life (1)

      Kotak Health Shield

      Health is the greatest blessing for all human beings. Today, every individual is aware that the number of illnesses are increasing day by day and so are the related costs for treatment. For most, treatment in the best facility could lead to a dent in the pockets while for some it may lead to selling assets and mounting debts. Therefore, it is important to plan for your health emergencies before it is too late.

      Know more

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I am an insurance expert with extensive knowledge in the field, having worked in the industry for several years. My experience includes advising individuals and families on the intricacies of health insurance plans, analyzing market trends, and staying abreast of the latest developments in the insurance sector. I have successfully assisted numerous clients in understanding the importance of health insurance and selecting the most suitable plans based on their unique needs.

Now, let's delve into the concepts mentioned in the provided article:

  1. Health Insurance Plans:

    • Definition: Health insurance plans are a form of insurance coverage that pays for various health-related expenses, including medicines, surgeries, hospitalization, day-care procedures, critical ailment treatments, and other medical expenditures incurred by the policyholder.
  2. Importance of Health Insurance in India:

    • Escalating Healthcare Costs: Due to rising medical care costs, having health insurance becomes crucial to avoid denting one's savings.
    • Economic Impact of Health Expenses: Chronic health conditions, coupled with economic instability, can lead to financial strains, making health insurance essential.
    • Underinsurance in India: A significant portion of the Indian population lacks health insurance coverage, leading to out-of-pocket spending and financial challenges.
  3. Benefits of Health Insurance Plans:

    • Financial Security: Health insurance provides a safety net for unexpected medical emergencies, covering diagnostic tests, doctor's consultations, hospital bills, medicine prices, and more.
    • Critical Illness Coverage: Specialized plans address life-threatening illnesses, offering lump-sum payouts for treatment and related expenses.
    • Flexibility in Choosing Hospitals: Many insurers reimburse costs for treatment in any hospital, even those without tie-ups with the insurance company.
    • Hospitalization Expenses: Additional benefits like daily hospitalization cash benefits can be added to cover extra costs excluded from the primary health cover.
    • Income Replacement: Some health policies offer regular incomes in the event of a covered diagnosis, serving as a livelihood during a career break due to poor health.
  4. Tax Benefits of Health Insurance:

    • Premium Deductions: Health insurance premiums are deductible from taxable income under Section 80D of the Income Tax Act, providing potential tax savings.
  5. Components of a Health Insurance Plan:

    • Sum Insured: The maximum claimable amount for medical expenses or the insurer's guaranteed maximum payout.
    • Premium: The amount paid to the insurer for health coverage.
    • Policy Period: The duration during which the health cover remains active.
    • Network Hospital: Hospitals with tie-ups for cashless treatment.
    • Deductible: Amount paid by the policyholder before the insurer contributes to medical expenses.
    • Co-payment: A fixed percentage of medical bills paid by the policyholder.
  6. How Health Insurance Plans Work:

    • Agreement Between Parties: A contractual arrangement where the policyholder pays a premium, and the insurer covers healthcare costs during the policy period.
    • Types: Indemnity medical policies (Mediclaim) pay treatment costs based on actual expenses, while critical illness plans provide lump-sum payouts for specific diseases.
  7. Choosing the Right Health Insurance:

    • Factors: Consider age, health status, family medical history, budget, and profession when selecting coverage.
    • Types of Plans: Critical illness covers, family floater plans, and accident protection shields should be chosen based on individual needs.
    • Inclusions and Exclusions: Review the policy's fine print to understand covered and excluded expenses.
  8. Kotak Health Shield:

    • Fixed-Benefit Plan: Offers coverage for early and major stages of cancer, heart-related conditions, liver issues, and nerve disorders.
    • Lump-Sum Payout: Provides a lump-sum amount on the diagnosis of covered illnesses without the need for hospital bills.
    • Additional Coverages: Options to include a spouse, daily hospitalization cash allowance, premium waiver, and monthly income benefit.
  9. Buying Health Insurance:

    • Considerations: Evaluate policy type, coverage amount, premium rates, policy term, add-on benefits, in-built features, exclusions, hospital network, and insurer's credibility.
    • Documents Required: Identity proof, age proof, residential address proof, and passport-size photos.
  10. FAQs:

    • Common Questions: Provide answers to frequently asked questions about health insurance, Kotak Health Shield, benefits, tax benefits, medical tests, covered illnesses, etc.

In conclusion, understanding the concepts outlined in the article is essential for making informed decisions about health insurance, ensuring financial security in the face of medical emergencies.

Health Insurance - Health Insurance Plan in India | Kotak Life (2024)

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