Overview of Health Insurance for Families

What is a Family Insurance Plan?

Family health insurance simply refers to a type of insurance that covers your entire family. Simply put, medical insurance for a family has one policyholder but multiple insured members. Still confused? Let's read an example for more clarity.

31-year-old Chandrika is a mother of two. Her family consists of her husband, a banker, her parents, and two children. Chandrika and her husband purchased health insurance for the family to cover their entire family under one plan.

How Does a Family Insurance Plan Work?

Let us continue with Chandrika’s example to understand how a family floater plan works. She purchased Health insurance plans for families that cover them all with a sum insured of ₹25 lakhs. Like most plans, the premium payment had to be made annually.

Now, if any insured family members fall sick, they can use the required amount out of ₹25 lakh sum insured. If another family member falls sick in the same policy year, they can utilise the amount from the remaining balance of the sum insured.

Suppose Chandrika purchased the policy in March. In May, her son fell sick and required hospitalisation, which cost ₹1 lakh. Now, the remaining sum insured balance is ₹24 lakhs. In the same policy year, her mother fell sick and required hospitalisation, amounting to ₹3 lakhs. So now, the remaining balance is ₹21 lakhs, which can be used by any other member if required. So, under a single premium, the sum insured amount can be utilised by the entire family.

Individual Health Insurance Plan for Family

When it comes to health insurance plans for families, you also have the option to go for individual health insurance. Here, unlike a family floater policy, every insured member has their own sum insured, which cannot be shared. While an individual health insurance plan can offer more coverage, many people prefer family floater plans as they are much more affordable. Also, it can extend coverage to many family members simultaneously.

Family Floater vs. Individual Plans

Unlike a family floater policy, in an individual health insurance plan, the coverage is not shared between the family members. Rather every member has their own separate insurance policy.

• Individual Plans: Each member gets a separate sum insured. These are ideal for individuals with higher health risks, pre-existing conditions, or elderly parents, as their medical needs might exhaust the coverage.
• Family Floater Plan: A single sum insured is shared among all family members. It’s cost-effective for young, healthy families with low healthcare needs. However, a major claim by one member could leave less coverage for others.

Choose based on your family’s size, age, health conditions, and potential medical expenses. Both offer benefits depending on your specific needs.

How do you select the sum insured basis family construct?

Choosing the sum insured for health insurance plans for families should consider the following:

1. The size of the family:
   Smaller families may need lower coverage; larger families need higher coverage.
2. Age and health:
   Any older persons in the family or those with pre-existing medical conditions will require a higher coverage amount because of higher chances of incurring medical and health care costs.
   Also, the claim possibilities of older members, especially senior citizens, are higher, so it could be a better choice to keep their policies separate from those of younger members.
3. Local healthcare costs:
   Consultation on expenses for treatments such as hospitalisation or surgeries in your local area.
4. "Rule of two":
   Make sure you have an amount that would cover the treatment of two members simultaneously while calculating the sum insured.
5. Future needs:
   Future costly needs may develop, such as pregnancy, elderly care, or chronic illnesses. These factors also need to be considered.

For a family of four (parents and two kids), start with a sum insured that covers major medical costs and adjust based on specific needs and risks.

Features of Family Health Insurance

Family health insurance can provide comprehensive coverage for your entire family's medical needs. Let's have a quick look at the features of family health insurance plans:

1. Medical Cost Management
   The entire family is covered in a family health insurance plan. It includes kids, older parents, spouses, and dependent children, usually up to 25 years of age. Any family member in need can use the sum insured amount of the Health insurance plans for families.
2. Single Premium Payment
   Medical insurance for a family charges a single premium for the entire coverage, regardless of the number of family members covered.
3. Cashless Claims
   Most of the health insurance providers now provide cashless claims. Under cashless claims, you can avail yourself of medical treatments at an insurer's network hospital, and your insurer settles the bill directly. The policyholder does not have to pay for admissible bills.
4. Certain Exclusions
   No health insurance plans cover every condition. Certain health conditions may remain uncovered and are termed as exclusions of the policy. Make sure to read the exclusions of your policy in detail before purchasing a plan. Common exclusions are:
   • Intended injuries
   • Drug or alcohol misuse
   • Involvement in illegal activities
   • Suicide attempt injuries
   • Maternity-related expenses
   • Treatment expenses for infertility
   • Congenital diseases
   • Cosmetic treatment
5. Add-on Riders and Benefits
   Another advantage of health insurance for the family is the wide range of add-ons. But remember that not every add-on may serve your family's needs. Pick what matches your needs. For instance, if you plan to start a family, an add-on/ plan with maternity benefits and child care will be a smart choice.
6. Tax Benefits:
   Under Section 80D of the Income Tax Act of 1961, policyholders can benefit from the premium paid towards health insurance plans for families. The policyholder can claim a tax deduction of up to ₹1,00,000.

Here are the tax deductions you can expect when you have a health insurance plan for your family.

In Conclusion

You cannot always control a health crisis. While no one wants to end up in a hospital, being financially prepared is necessary. Health insurance plans for families can be of different types. Depending on the type of insurance you choose, the premium is charged, and benefits are provided. When you purchase from Jio insurance Broking, you can be confident that you're buying from a reputable, reliable health insurance company. This means we've already taken care of the essential checks for you!

If you're looking for the best health insurance plans for your family, contact Jio insurance Broking today!

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