Buying health insurance - India

The cost of treatment will keep going up, I think that is a statement that one can make safely. There are multiple reasons why one should budget a larger sum in the course of your life planning - lifespans have tended to increase - Average lifespan for Indians is ~65 (check data?), while lifestyles have changed to better - they have also brought lifestyle diseases, diagnostic tools and medical procedures have improved and are far widely available - so even if by a stroke of bad luck if you were to end up with one - chances that you will be treated and most probably survive are higher - bottomline - you might live longer, get treated for diseases and might spend money on medical procedures.

Research has shown that one of the reasons why families stay in abject poverty or take major knocks on income levels is a sudden spend on medical expenses - given the poor social security net that we have in India - The ESIC does a good job I must say, but for a majority of middle class urban public who will want to get treated in a good hospital ( quick diversion : while the government has nearly exited the health space by proxy, it still is active and some of the hospitals I have seen serve the poor and needy extremely well - whatever the drawbacks in the system, it is serving some purpose and can go a long way still), the cost can be very high. A few days stay, a few diagnostic procedures, 2 visits by the specialist, a minor surgery can lead a healthy bill, if not a healthy person!!, of 30-40 k today. A major illness will notch up bills upto 2-3 lakhs - ok enough of the obvious what am I trying to say - don’t gamble with your health, stay healthy and plan for the worst - go buy health insurance

Why you should not depend on the health insurance provided by your employer :
So your kind employer has tried to be concerned about the business of your health and has provided a group insurance and covers your family too, it’s a good beginning…but go out and buy a good health insurance independently….reasons :
a. When you shift companies, you lose the cover - any event in between two stints is not covered - in the era of job hopping this is a reality which you cannot ignore, with my healthy regard to the angels who dwell human resources land, you can expect to be without a new cover for a few weeks or months
b. No claim bonus accrual : a healthy record leads to no claims bonuses which get accrued to you, in a company scheme this accrues and gets distributed, a good long record goes a long way in getting you a best deal -while some insurers allow you to shift no claim bonuses, most don’t - so start early build a case
c. Some insurers will not cover pre existing illnesses or will cover only post a period of look out - so if lets say you have hyper tension, then for a period of 3 years this will not get covered or a partial cover is given. So if you have aged parents, then while the company usually arm twists and get pre existing illnesses covered, the cost of that is built into the premium you or the company pays - so an early starts ensures you get covered
d. Buying health insurance in India, where the insurers are acting like the spawn of satan and denying the benefits or playing dirty when it comes to elderly people is very painful. You will usually find conditions like the whole family needs to buy a cover, or the highest amount is capped, or the illness get excluded -the list of woes is long - bottomline build a case, buy early - problem with company cover is you can never carry it through
e. Buying insurance after you have had a major illness is next to impossible - start when you are healthy, the insurance company will be decent enough to atleast remember the hard earned money you parted in good ole days and humor you for sometime without being spawn of satan
f. Usually company provided schemes do not qualify for tax breaks - this is a perverse incentive - go figure
g. The cover will expire when you retire, see if you can ever buy cover at that time….build the history..thats my theme….

So go buy a health insurance, I bought it from Star Health insurance and am fairly happy, although I think I underestimated the cover I need. Dhammo in his post came up with a large number - 20 times annual earnings - I think the insurance company will think I will be drug company specimen if I ask for such a large cover. My approach - estimate 30-45 days stay in a hospital + a specialist visitation fee + medicines at similar amount and some more - for a city like Bangalore this number is like 6 lakhs I think - go buy that first for your parents - you can start at half that if you under 30, and increase it to that level by the time you 40. This is my broad thumb rule

(I had resolved to post once a week this year- its been 5 weeks now without a post - the market mayhem and general conditions playing a havoc on mind, time and life... it will be slow coming...please keep visiting, there shall be posts! Thanks for being around)