A STUDY ON INVESTING IN MEDICAL PREMIUM FOR A

MIDDLE CLASS INDIVIDUAL

INTRODUCTION

INSURANCE:

An Insurance act of 1938 was the first legislation governing all forms `of
insurance to provide strict state control over insurance business. It extends to the
whole of India. It shall come into force on such date as the Central Government may,
by notification in the Official Gazette, appoint in this behalf.

Insurance is a co-operative device that spread the loss caused by particular risk over a
number of persons. Always the word insurance is associated with the word risk. It
facilitates re-investment during crisis situation. Insurance is a social device to bit
uncertain losses arising through certain risk to a person or property of person insured
against it. It is a protection against financial losses arising on the happening an
unexpected event. As an individual life is subject to various risk in personal life, death
or premature death. In business, person business property is subjected to loss by fire,
theft and natural calamities. Insurance is a device by which loss suffered from various
risks to an individual can be minimized. Insurance provides indemnification against
loss arising from happening of some event.

Meaning:

An Insurance transaction is a contract between two parties i.e. insurer and insured
under which the insurer undertakes the compensate the insured for loss arising from
the risk insured against. Premium is the consideration of the contract of the insurance
which is paid by the insured to the insurer for the risk undertaken by the latter.
Insurance is a co-operative device that spread the loss caused by particular risk over a
number of investment during crisis situation. Insurance is a social device to bit
uncertain losses arising through certain risk to person or property of a person insured
against it. So insurance is a contract between two parties:

1. Insurer (company)
2. Insured (person)
The instrument containing the contract of insurance is called a policy. According to
law of contract, the contract requires all the essentials of a valid contract as
mentioned below:

1. Offer and acceptance

2. Consideration
3. Capacity to contract
4. Consensus at item (free consent)
5. Legality of purpose.

Insurance can be defined as the process of reimbursing or protecting a person from

contingent risk of losses through financial means, in return for relatively small,
regular payments to the insuring body or insurance company.

Insurance involves pooling of funds from many insured entities (known as exposures)
to pay for the losses that some may incur. The insured entities are therefore protected
from risk for a fee, with the fee being dependent upon the frequency and severity of
the event occurring. In order to be insurable, the risk insured against must meet
certain characteristics in order to be insurable risk. Insurance is a commercial
enterprise and a major part of the financial services industry, but individual entities
can also self-insure through saving money for possible future losses.

Until 1999, insurance services were provided in India by two monopolistic public
sector organisations namely, life insurance corporation of India and general insurance
corporation of India. in order to provide better insurance cover to citizens and also to
ensure the flow of long- term sources of financing infrastructure the government
opened up the insurance sector and also set up a statutory Insurance Regulatory and
Development Authority in 1999.

Any class of insurance business in India can be carried out only by:

i. A public limited company;

ii. A co-operative society;
iii. An insurance co-operative society;
Having paid up capital of Rs. 100 crores in which no body corporate holds more than
26 percent of its paid up capital and whose sole purpose is to carry on insurance
business in India.

Thus, only Indian Insurance companies are permitted to carry out class of insurance
business after the commencement of IRDA Act,1999. An Indian Insurance company
is defined as a company formed/registered under companies act.

DEFINITION:

Some of the important definitions of insurance are as follows:

According to IRDA

“Insurance is a social device which reduces or eliminates the risk of loss of

the life or property against premium paid.”

According to Insurance Act of 1938

Insurance is defined as “A provision which a prudent man makes against

inevitable contingencies.”

In legal sense

“Insurance is a contracted agreement whereby one party agrees in

consideration of the price paid to him (premium) compensates another party
for losses.”

In financial sense

According to Riepel and Miller , “ Insurance is a social device whereby the

uncertain risks of individuals may be combined in a group and thus made
more certain, small periodical contributions by the individual providing a
find, out of which, those why suffer losses may be reimbursed.”

Prof. John H. Magee:

“Insurance is a plan by which large number of people associate themselves

and transfer, to the shoulders of all, risks that attach to individuals”.
Functions of insurance:

Following are the main functions of insurance:

 The main function of insurance is to provide certainty of payment against the

occurrence of sudden loss arising due to happening of uncertain event. Thus
insurance removes uncertainty. The function of insurance is primarily to
decrease the uncertainty of event.

 Insurance also provides protection against the probable chances of loss.

The time and amount of loss are uncertain and at the happening of risk, the
person will suffer loss in absence of insurance. The insurance guarantees the
payment of loss and thus protects the assured from sufferings. Although
insurance cannot check the happening of risk but can provide for losses at the
happening of risk and thereby creates security to the insured.

 Insurance involves sharing of risk which implies that insurance spreads the
financial losses of insured members over the entire community by
compensating the unfortunate few from the funds built up from the
contribution of all members.

 The insurance provides capital to the business houses and industrialists by way
of lending the funds to them or making contribution to their share capital. In
other words, the funds accumulated by insurance companies by way of
premiums are invested in productive channels.

 The insurance minimizes the worries and miseries of losses arising due to
death of insured or destruction of property. The carefree person can devote
himself in a better manner towards the achievement of objectives which
results in enhancing his efficiency and rapid economic growth.
Benefits of insurance
1. Insurance policy is a suitable way for providing for the future of most of the
people who find it difficult to save and accumulate funds for the evening of
their lives.
 2. Insurance plays an important role in the expansion and promotion of foreign
trade.
3. Insurance helps in spreading education.
4. Insurance companies accumulate large funds which they held as custodians
and out of which claims and losses are met a large portion of such resources
are invested in various securities and social welfare purposes.
5. Confidence building and removal of fears from the minds of businessmen
and individuals against sudden losses, is a job done by the insurance.
6. The spreading of the financial losses of insured members over the entire
community in an equitable manner by compensation of the unfortunate few
Introduction from the funds built up from the contributions of all members is
done by the insurance.
7. It helps businessman in facing the competition and in expanding the size of
business units.
8. Insurance has considerable effect on the reduction of losses due to the loss
prevention measures of the insurers.
9. Insurance is an item of invisible exports and contributes significantly to the
balance of trade.
10. Insurance also increases the credit of a man as money can be easily
borrowed on the security of goods and property insured against fire or sea
perils or on the basis of a life policy.
11. Insurance takes care of some of the social problems which beset a modern
civilized society.
12. Insurance accelerates the process of economic growth in various ways. By
providing for events which may be anticipated, the insurance acts as a
stabilizer of economic growth.
Legal Framework:
The Insurance Sector in India is governed under two important acts i.e.
Insurance Act, 1938 and the Insurance Regulatory and Development authority
act, 1999. But there are some other acts also that have to be taken into
consideration.
1. The Companies Act, 2013
2. The General Insurance Business (nationalization) Act, 1972.
 HEALTH INSURANCE
Introduction:
Health Insurance (popularly known Medical Insurance or Mediclaim) protects
you and your dependents against any financial constraints arising on account of a
medical emergency. It sometimes includes disability and long term medical needs. In
mediclaim, you pay a premium and in return the insurer commits to pay a
predetermined sum of money to, meet the claims. Health Insurance is new in Indian
context and is slowly catching up with the consumers. Consumers understand the
objective of health insurance and it’s offering to cover the ever rising medical
expenses.
A health insurance is a contract act between the insurance company and the
policy holder, wherein the insurer pays for the medical expenses incurred by the life
insured. The insurer will either provide the reimbursement for your medical expenses
or ensure you are eligible for cashless treatment for injures or illness covered under
the policy at one of the network hospital. You can also get tax deductions on premium
paid towards the health insurance under section 80D of income tax act, 1961.
Health is available and groups. However, premium for individual policy is
costlier than that of the group policy. An individual is the owner of his personal
policy. Whereas in group plans, sponsor is the owner of the policy and the registered
members are covered by the policy. You can take advantage of group health insurance
to overcome the shortage of your individual insurance. People with no policy or are
uninsurable due to one or the other reason can take good advantage of group plans
and be covered.
Under this insurance the insures undertake to indemnify the insured in
considerations of a friend price called premium. Health insurance provides direct
payment or reimbursement for expenses associated with illness and injures. Due to the
increase in the cost of health care and treatment, health insurance has become
essential in today’s world. However, before buying a health insurance policy, plan
your requirement carefully. It will save you from buying a policy which might not be
appropriate for you and can also be expensive.
What is Health Insurance?
The term health insurance (popularly known as Medical Insurance or
Mediclaim) is a type of insurance that covers your medical expenses. The concept of
Health insurance is new in India but its awareness is growing fast. Health insurance
comes in handy in case of severe emergencies. Life is unpredictable, insurance can
make it safe and secure from bearing huge financial loss. A health insurance policy is
a contract between an insurance company and an individual. Sometimes it is
associated with covering disability and custodial needs. The contract is renewable
annually.
Health insurance is affordable and carries the assurance and freedom from
insecurities that threaten normalcy now and then. The type and amount of health care
costs that will be covered by the health plan are specified in advance. Health plans are
available in two formats, individual and group plans. In an individual policy you are
personally the owner of the policy. While in a group plan, the sponsor owns the policy
and the people covered under it are called its members.

What is Health Insurance Premium?

A Health Insurance Premium is an upfront payment made on behalf of
individual or family in order to keep their health insurance policy active. Premiums
are typically paid monthly when purchased on the individual market, although
individual who receive insurance through their employer usually pay their portion of
the premium through payroll deduction. In addition to the premium, consumers , may
have to pay out-of-pocket costs-deductions, co-pays and coinsurance –when they seek
medical care. Health insurance premium are the cost you pay, usually on a monthly
basis, to keep your policy in force. If you skip your premium payment, the insurer will
eventually drop your health care coverage. Premium are not only the expense you
incur to receive medical care. Even after paying your monthly fee, you may have to
pay out-of pocket expenses based on the amount and type of care you receive.

Factors Affecting Premium of Health Insurance

Like any other insurance, the premium for health insurance also depends on
some factors which determine the amount we pay out. At times we generalize paying
out the premium as an expense, but remember it is only a precaution for secure future!
It can save us huge loss if the coverage is planned carefully.
 1. Age is a major factor that determines the premium, the older you are
the premium cast will be higher because you are more prone to illness.
2. Previous medical history is another major factor that determines the
premium. If no prior medical history exists, premium will
automatically be lower. However, if you suffered from specific illness
the premium may turn out to be expensive.
3. The premium cast also depends on the work environment of the
insurance buyer. Supposedly the premium of a pilot will be more
expensive than that of a teacher, or premium of a miner will be
expensive. This is because the job of a pilot and a miner are more
hazardous, thus they are more prone to disorders and risks than a
teacher.
4. Term of the policy helps in determining the premium, the longer the
term the cheaper is the premium and vice versa.
5. Claim free years can also be a factor in determining the cost of the
premium as it might benefit you with certain percentage of discount.
This will automatically help you reduce your premium.
Coinsurance is the portion of the health plan that requires you to pay a
percentage of the coverage meaning that you will essentially be splitting the cost of
your healthcare with your insurance provider. For instance, if your health plan has an
80/20 co-insurance rate, your insurance plan pays for 80% of your eligible medical
expenses and you are responsible to cover the remaining 20%of the expenses.

Evolution of Health Insurance

The concept of Health Insurance was proposed in the year 1694 by Hugh the
elder Chamberlen from Peter Chamberlen family. In 19th Century Accident
Assurance began to be available which operated much like modern disability
insurance. This payment model continued until the start of 20th century. During the
middle to late 20th century traditional disability insurance evolved in to modern
health insurance. Today, most comprehensive health insurance cover the cost of
routine, preventive and emergency health care procedures and also most prescription
drugs. Healthcare in India is in a state of enormous transition, increased income and
health consciousness among the majority of the classes, price liberalization, reduction
in bureaucracy, and the introduction of private healthcare financing drive the change.
Over the last 50 years, India has achieved a lot in terms of health insurance. Before
independence, the health structure was in dismal condition i.e. high morbidity, high
mortality and prevalence of infectious diseases. Since independence, emphasis has
been put on primary health care and made considerable progress in improving the
health status of the country. But still, India is way behind many fast developing
countries such as China, Vietnam and Sri Lanka in health indicators. Health
insurance, which remains highly underdeveloped and less significant segment of the
product portfolio is now emerging as a tool to manage financial needs of people to
seek health services. The new economic policy and liberalization process followed by
Government of India since 1991 paved the way for privatization of insurance sector in
the country. The Insurance Regulatory and Development Authority (IRDA) bill
passed in Indian parliament is the important beginning of changes having significant
implications for the health sector. Health Insurance is more complex than other
segments of insurance business because of serious conflicts arising out of adverse
selection, moral hazard, unavailability of data and information gap problems. Health
sector policy formulation, assessment and implementation are an extremely complex
task, especially in changing epidemiological, institutional, technological and political
scenario. Proper understanding of Indian health situation and application of principles
of insurance, keeping in view the social realities and national objectives are important
(Anitha. J 2008).

Importance of Health Insurance

Health Insurance can be defined as an insurance where an individual or a
group purchase in advance a health coverage by paying a fee called premium, which
will avoid or reduce the expenditure of the consumers at the time of use of health care
services. The growth of health insurance sector has been proliferating in the last few
decades in India. Health insurance is well established in many countries. In India, the
number of people covered by health insurance in some form or the other, (i.e.)
whether public or private is abysmally low and is only 3percent of the total Indian
population (Sukumar Vellakal 2007). Given the health financing and demand
scenario, health insurance has a wider scope in present day situations in India. In the
last couple of years, health insurance has emerged as one of the most promising
growth segment with increase in not only the number of variety of products but also
in the number of insurance companies venturing into the health insurance market. The
importance of health insurance can never be undervalued for the following reasons:
 Provides security to human life which is of prime importance to any
individual.
 Closely bonds insurance companies, hospitals, policy holders and third party
administrators (TPA) together for the benefit of Indian masses.
 An answer to the solution of uncertainties and risks are prevalent and ever
pervading in human life.
 Prevention and minimisation of unforeseen losses.
 Access to quality health care.
 Means of savings and a safe investment option.
 Provides financial stability in life.
 A tax saving instrument that significantly contributes in reduction of tax.
 Reduces tension and stress caused on account of hospitalisation.
 Greatly contributes in leading a stress free life.
Types Of Health Insurance Plans In India:

 Individual Health Insurance:

As the name suggests, Individual health insurance plans are made for
individual policyholders. The premiums might be low under such
plans, but there are variety of factor that contributes to the price of the
policy. Previous medical conditions, age, location, etc. are few of the
parameters that influence the premium. Under this policy, the
reimbursement of medical expenses incurred towards hospitalization,
which implies that a patient, may get the medical treatment at home in
case where he/she is unfit to be moved to the hospital.
 Family Floater Health Insurance:
Instead of buying separate policies for every member, a family floater
plans cover the entire family under one plan. Typically, parents and
children (up to 2 children) can be covered under this plan, the sum
insured is shared by all the included family members. Even though
family floater plan have a higher premium than individual plans, the
price is still cheaper when compared to the expenses involved in
buying a different policy for each member.
 Senior Citizen Health Insurance:
Designed to cater to the needs of the senior citizen, such plans are only
for the ones who are 60 years old and above. Senior citizen plans are
usually come with discounts. though only a few insures provide such
policies, they might ask for medical check up before selling plan. Also,
these policies may cost a lot higher than the health covers for younger
consumers as senior citizens are more prone to diseases and illness.
 Critical Illness Health Insurance:
Critical illness plans cover life- threatening illness. Cancer, heart
attack, organ transplant, kidney failure, etc., are few of illnesses
covered under such policies. A critical illness cover is especially useful
if the insured has a history of critical illness in the family. Critical
illness plan insures you against the risk of serious illness in return of a
premium you are required to pay. This gives you the same security of
knowing that a guaranteed cash sum will be paid if the unexpected
happens and you are diagnosed with any one of the critical illness.
Sometimes a critical illness can change your lifestyle in addition to
help within the home or the family. In this type of health insurance
plan, the insured receives a lump sum amount within a few days of
diagnosing critical illness. Once this lump sum is paid, the plan ceases
to remain in force. Typically, a critical illness plan would provide
cover for the illnesses mentioned below.
 Maternity Health Insurance:
Maternity plans are designed to cover the expenses incurred in the pre-
natal stage, delivery, and post-natal stage. Both the mother and the
newborn are covered under such plans can also be bought as a rider to
an existing basic policy.
 Group Health Insurance:
Such plans are usually offered by employers and are designed to
include and exclude members as they join and leave the company.
Group health policies are generally law in premiums due to the
reduced risks involved. Such plans also allow leniency in terms of
covering pre-existing illnesses among other things.
  Preventive Healthcare:
A preventive healthcare policy covers the expenses incurred during
treatments/measures taken to prevent a certain disease, illness, or
cancer. Annual check-ups and screening tests are few of the services
that are covered under preventive healthcare.
 Personal Accident Insurance:
Personal accident plans specifically cover the expenses related to
unforeseen accidents. Such policies compensation in cases of
disablement, death, injury, or impairment caused by road, rail, or air
accidents.
 Medical Insurance:
This is typically a hospitalization cover and reimbursement of the
medical expenses to the incurred in respect of covered diseases or
surgery while the insured was admitted in the hospital as a patient.
Different types of medical insurances are available in the market like
individual medical insurance, group medical insurance and overseas
medical insurance. There are health policies that reimburse you the
actual hospitalization cost for treatment of any disease and are offered
by the non-life insures only. These policies are popularly called
“Mediclaim” policies. Other types of health insurance are provided by
the both the life and non- life insurers.

Health Care Schemes By Government of India

The Indian government (center & state) have launched numerous medical insurance
schemes to improve healthcare and make it accessible for the weaker sections of
society here is a list of health insurance scheme provided by the government:

 Rashtriya Swasthya Bima Yojana:

This scheme was launched by the ministry of labour and employment
to provide health insurance coverage for families below the poverty
line. The beneficiaries under this scheme can avail a health benefit
cover of up to Rs. 30000. A registration fee of Rs.30 is chargeable.
 Pradhan Mantri Suraksha Bima Yojana:
Is an initiative by the government to bring access to insurance
especially for the economically weaker sections of society. This
scheme features affordable premiums and provides compensation to
the family of the deceased.
 Central Government Health Scheme (CGHS):
This scheme was launched in 1954. It provides comprehensive
healthcare facilities to the central government employees, pensioners
and dependents of these employees.
 Aam Aadmi Bima Yojana (AABY):
This is a social security scheme launched in 2017 to provide healthcare
facilities for rural landless individuals. The head of the households or
earning member of family will be covered under the scheme (AABY).
The beneficiary will receive Rs. 30,000 upon natural death, Rs.75,000
upon accidental death or permanent disability, and Rs. 37,500 on
partial diability.
 Janashree Bima Yojana (JBY):
This scheme was launched in august 2000. This scheme targets people
falling below the poverty line (BPL) in 45 occupational groups covered
under the scheme.
 Employment State Insurance Scheme(ESIS):
This is a social security initiative aimed at providing socio-economic
protection to the working class and their dependents. The scheme
ensures that all member and their family will receive full medical care
from day one.
 Universal Health Insurance Scheme(UHIS):
The Indian public sector insurance companies have implemented this
scheme to improve the access to healthcare for poor underprivileged
families. Beneficiaries will receive reimbursement for medical
expenses up to Rs. 30000 and accidental death cover up to Rs. 25000.
The insurance premium for this scheme is Rs. 200 per person, Rs. 300
for a family of five, and Rs. 400 for a family of seven.
Need For Health Insurance

Medicare or medical costs are rising year on year. As matter of fact, inflation
in Medicare is higher than inflation in food and other clothing is in single digits,
medicare costs usually escalate in double digits. For individual who hasn’t saved that
much money, arranging for funds at the eleventh hour can be a task. This is
particularly daunting for seniors, given that most ailments strike at an advanced age.

One way to provide for health-related/ medical emergencies is by taking

health insurance offers considerable flexibility in terms of disease/ailment coverage.
For instance, certain health insurance plans cover as many as 30 critical illnesses and
over 80 surgical procedures. The insurance plan disburses the payment towards
surgery/ illness regardless of actual medical expenses. The policy continues even after
the benefit payment on selected illnesses. With health insurance, you are assured a=of
a more secure future both health-wise and money-wise. This makes health insurance
policies critical for the financial well-being of the family.

Benefits Of Health Insurance:

Cashless Treatment:

When you are covered under a health insurance policy, you can avail
cashless treatments which essentially means that you can receive
medical treatments without having to pay the hospital from your own
pockets. As your insurance company would work in collaboration with
various hospital networks.

Pre And Post Hospitalisation Cost Coverage:

Effective insurance policies offer coverage for pre-as well as post-

hospitalisation expenses for a period of 60 days, depending upon
insurance plans purchased.

Transportation Charges:

In case you hold health insurance policy and get hospitalised the plan
will cover the costs incurred on using an ambulance to transport you
from your home to the hospital or vice versa.
Medical Checkup:

Insurance policy also provide options for health checkups. Most health
insurance policies offer free health check-ups. However, most
insurance companies only offer these check-ups for free depending on
your no claim bonus.

No Claim Bonus:

If you hold a health insurance policy and do not make any claims over
the course of an entire policy year, you will be rewarded in the form of
a no claim bonus.

Room Rent:

Insurance policy also covers room expenses depending on the premium

being paid by the insured. In case you are hospitalised, you will have
to incur costs on room rent. Having a health insurance policy will
ensure that these costs are covered to a significant extent.

Tax Benefits:

Having a health insurance policy can offer tax benefits as well. The
premium payments you make towards your health insurance plan
quality for tax deductions under sections 80D of the income tax act.

Online Purchasing Facility:

Thanks to the advancements in technology, you no longer need to visit

a branch of the health insurance company in order to purchase a plan.
You can do so from the comfort of your own home or office.

Renewal:

The renewal of your health insurance policy can also be done online.
There is also a lot of flexibility when it comes to renewing your
insurance plan. You can alter the terms of coverage based on what you
think will work best for you.
 Cover of OPD Expenses:

Most of the traditional health insurance plans require the insured

individual to be hospitalised for a minimum of 24 hours if they are to
be eligible for reimbursement.

Health Insurance Claim Process:

. Health insurance acts as a safety net for an individual finances in case he/she
meets with unforeseen accident. A Health insurance policy equips you to get the best
health care treatment without worrying about the huge costs payable at the time of
discharge. Therefore knowing about the claim process is an essential piece of
information that the insured individual should be aware of at all times. There are two
types of health insurance claim which an individual can choose from when making a
claim are:

 Cashless claim process

For all the illnesses covered under the health insurance policy, the
insured receive treatment from the hospital by providing the details of
the health insurance policy along with some proof for the poliy. Upon
discharge, the hospital will forward the medical bills to the designated
health insurance company. The company will then audit the expenses
and settle the outstanding payment due to the hospital. This process is
hassle-free for the insured as the payments are between the hospital
and insurance company. There is a separate claim process for planned
treatments and emergency treatments.
 Reimbursement Claim Process
In the reimbursement claim process, the insured individual who has
been admitted to a certain hospital pays for the entire treatment until
discharge. Once the insurer has paid for the treatment and
hospitalization costs incurred, he/she have to make a reimbursement
claim to the particular insurance company. The insured individual will
have to provide original bills of the hospital to the health insurance and
claim reimbursement. The insurance company will audit the claim and
will then decide to approve or reject it. In approval of the insurance
company, the claim will be made to the policyholder. The insurance
 company will notify the insured individual in case the claim has been
rejected.

How To File A Health Insurance Claim?

Taking health insurance and paying premium is one story and filling for claim
is another. Claiming benefits can be quiet tricky at times so you have to be smart and
careful while filing for the claim. To file a health insurance claim with your insurance
company one has to keep the following things in mind:

1. Claim from duly filled and signed by the claimant.

2. Discharge certificate from the hospital.
3. All documents pertaining to the illness starting from the date it
was first detected i.e. doctor’s consultation reports/history.
4. Bills, receipts, cash memos from hospital supported by proper
prescription.
5. Receipt and diagnostic test report supported by a note from the
attending medical practioner/surgeon justifying such
diagnostics.
6. Attending doctor’s certificate stating the nature of the operation
performed, bill and receipt. Attending consultant’s/ specialist’s
anesthetist’s bill and receipt, and certificate regarding
diagnosis.
7. Certificate from the attending medical practioner/ surgeon that
the patient is fully cured.
8. Details of previous policies if the details are not already with
TPA(third party administrator) except in the case of accidents.

Eligibility Criteria

When you wish to purchase health insurance, the insurance company could
ask you to take certain medical examinations. After your age, your health is the
second most crucial factor that aids an insurance company in assessing your
premiums. Currently, majority of the health insurance companies in India provide
coverage to individuals under 45 years of age without the need for medical exams.
However, your pre-existing conditions, if any, will certainly be taken into
consideration by the health insurance company. If your insurer does not insist on
taking a medical exam, you will be asked to furnish a declaration of good health in
addition to disclosing your pre-existing conditions such as hypertension and diabetes.
Having no pre-existing conditions and being younger will help you find plans for
lower premiums.

Medical examinations usually comprise mainly of physical, urine, and blood

test. Although these tests seem simple, they have the ability to disclose a lot regarding
human health. They can detect abnormalities in kidney and liver functions as well as
an increase or decrease in blood sugar levels. They can also reveals whether you
consume tobacco or alcohol. Those who seek health insurance and are above 55 years
of age are generally required to take additional medical exams.

Documents Required For Health Insurance Policy

1. Age Proof:
Any one birth certificate, 10th or 12th mark sheet, driving
license, passport, voter ID, etc.
2. Identity Proof:
Driving license, passport, voter ID, pan card, aadhar card,
which proves one’s citizenship.
3. Address Proof:
Electricity bill, telephone bill, ration card, driving license,
passport, should clearly mention the permanent address.
4. Some Plans Require a Medical Check-up:
(usually for elder people above the age of 45 years)
5. Passport Size Photo
Tax Benefits on Health Insurance

The amount you pay towards health insurance premium claimed as a tax-
saving deduction under section 80D. you can claim RS.25,000 annually for a health
insurance policy for yourself. If you also pay the premium for a health insurance
policy for your parents, you can claim up to RS.30,000 for the same as well. Earning
money is not at all useful if you don’t have a life. You are eligible for tax benefits on
the premium you pay for your health insurance. You can avail tax benefits for the
premium paid for the health insurance policy according to section 80D of income tax
act,1961.

Difference Between Mediclaim Insurance And Health Insurance

POINTS MEDICLAIM INSURANCE HEALTH INSURANCE

Mediclaim provides
reimbursement for
Meaning hospitalization expenses incurred medical expenses incurred by the
by the life insured.
It doesn’t offer any add-on
coverage.
Add on
Coverage
Plan Features Features of a mediclaim plan
vary insurance provider to
insurance provider. Generally
different mediclaim insurance
companies offer different
mediclaim insurance coverage.
Claims In the mediclaim plan, a
policyholder can file claims until sum assured is paid, no further
the total amount assured is
exhausted.
Health insurance plans offer a
comprehensive cover against
life insured due to an illness or
accidental injury.
In order to enhance the insurance
coverage, it offers critical illness
coverage, personal accident
coverage, accidental disability
coverage, maternity coverage, etc.
Generally, the benefits and
features of a health insurance plan
of a specific sum insured are the
same over most insurance
providers.
Once the claim is made and the
claims can be made under a health
insurance plan.
Critical illness It does not provide coverage for
cover critical illness. Mediclaim works
on the indemnity principle,
wherein the life insured is
reimbursed his or her
hospitalization expenses.
When it comes to coverage, it
offers no flexibility.
Flexibility
Sum Insured The sum assured for
Critical illness coverage for more
than 30 plus critical diseases such
as cancer, stroke, kidney failure,
etc. personal accident disability
cover are some of the add-ons or
riders that can be attached to the
base health insurance policy
wherein the life insured is paid a
lump sum amount as benefit.
On the other hand, a health
insurance plan offers much
needed flexibility. Insurance
buyers can reduces their health
insurance premium amount after
a specified period; they can even
change their policy duration.
They can avail long term policies
to enjoy maximum insurance
benefits.