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Healthy way to security

A life insurer is not tuned to handle a large number of claims and the coverage terms are also quite different.

By Swaraj Krishnan | Print Edition: October 18, 2007

Swaraj KrishnanLife insurance is important, as you want to safeguard the financial security of your dependents. But what about your own financial well-being when illness strikes and you cannot earn? Pure life insurance alone cannot help.

You need health insurance as well. That’s because health is unpredictable; even if you take good care of yourself, you could be caught off-guard by an unexpected illness or injury. Anything from the birth of a baby to a change in job can influence your health quotient.

To ensure that you do not lose out financially when illness strikes, you need some form of health insurance. You can avail of pure health insurance benefits or reimbursements in case of medical eventualities or accidental injuries.

Included in health cover are various types of insurance such as accident insurance, accidental disability insurance, medical expense insurance, and accidental death and hospitalisation allowance. As you can see, health insurance takes care of all the ailments and health hazards one can face during the course of life.

Most salaried people have health insurance in the form of CGHS, ESIS or group health insurance, which is usually taken by the employer. If these covers are not available, one has to opt for an individual health insurance plan, such as hospitalisation reimbursement plans. These are also available in cashless variants where the settlement is directly addressed by insurers.

Recently, life insurance companies have started offering health insurance plans as riders to existing life insurance plans. However, a life insurer is not tuned to handling large number of claims and the coverage terms are also quite different.

A prospective policyholder should compare the benefits, exclusions and coverage provided by life and health insurance companies, before deciding.

Whichever you choose, make sure you read the policy details carefully before signing on. This will help you understand what’s covered and what’s excluded. Health insurance plans used to exclude pre-existing diseases.

Your ability to get health insurance coverage was affected if you or your family had a history of medical problems. With the entry of the private players, this seems to have been corrected, and most insurers now cover preexisting diseases for a predefined period ranging from one year to four years.

With health-care costs going up, the need for health insurance increases manifold. Those without health insurance often wait until the problem reaches a level when they are very sick or when their condition becomes very expensive to treat. Medical care in such cases can add up quickly to a staggering financial loss.

One must understand that health insurance coverage helps protect you financially. There are suitable health insurance plans that can help limit your out-of-pocket hospitalisation costs, protect your assets and even safeguard your future earnings. The beauty of health insurance is the fact that for small premiums you can have coverage if ever you need expensive medical treatment.

Swaraj Krishnan, CEO, Bajaj Alliaz General Insurance

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