Family Floater Plans vs. Individual Plans: A Quick Comparison

Amir got ready to drive his son to school. They were already late, and both scurried to the car. When both were seated, instinctively Amir bent sideways to fix his son’s seatbelt even before the car alarm started buzzing. Amir suddenly realised that his priorities in life had changed completely. It struck him that if he were hospitalised, a health insurance policy would be in place to take care of him, but there is nothing to ensure that his son gets the best medical care if required. Strange but true, there is no financial seatbelt that protects his son from a sudden, God-forbidden health hazard. But he got even more confused. Should he opt for an individual plan or a family floater plan for adequate coverage? Not quite easy to decide. Especially when you think with your heart. Given the fact that both have their perks and benefits, which is the one that best suits your needs, budget and lifestyle? Moreover, they are designed differently, and a deeper understanding is required to decide which one is the best choice for you. One wraps your entire family under a cosy blanket, and the other offers customised benefits. Put your worries aside. This quick, yet comprehensive comparison will aptly show you the way to the right choice.

The Pros and Cons

Simply listing the benefits and drawbacks can give clarity to your thought process. Why not begin with it?

Individual Health Insurance

Advantages

  • Customised and tailored to meet individual health needs.
  • May often have added benefits of critical illness and other wellness perks.
  • The sum assured caters to the needs of one person, and sometimes multiple claims are allowed, lowering repeated hospitalisation costs.
  • Most plans offer lifetime renewability, and coverage extends till you need.

Disadvantages

  • It becomes expensive if you are buying for individual family members separately.
  • Multiple policies with different features and dates of premium payments are difficult to manage.
  • The sum insured is fixed and cannot be shared even if all the policies are issued by the same provider.

Family Floater Plans

Advantages

  • Cost cost-effective plan as one policy covers all family members like spouse, children and sometimes, parents and even in-laws.
  • Plans are flexible, and the sum assured can be used by any member covered under the plan.
  • The amount of sum assured chosen is usually higher due to multiple coverage, and new members can be added under it as per the plan's provision of entry age.
  • Individuals also enjoy the tax benefit under Section 80D of the Income Tax Act.

Disadvantages

  • The risk of high usage of the sum assured is greater. One member can use up the majority amount in one hospitalisation.
  • These plans become costlier if you include aged parents and in-laws, as the premiums and deductibles increase with age. The addition of a new member may also lead to premium escalation.
  • In case the primary insured individual exits the policy, the coverage for the entire family ceases. Also, children are not considered under the umbrella once they reach adulthood.

Settling the Face-off: Individual Health Insurance Vs Family Floater Plan

But the confusion remains. When is it good to choose a separate plan, and when to opt for the family plan?

Assess Healthcare Needs

Considering age, medical history, and pre-existing illnesses, if your family members' health requirements are significantly different, separate plans may be a better option to satisfy their needs.

Family Size

Family floater plans are aptly curated for nuclear family sizes with younger generations living together. If you have a bigger family with diverse medical needs, opting for a floater plan may not be justified financially and medically.

Affordability of Premiums

Check out websites like Jio Insurance Broking, where you can compare premiums and features of individual plans and family floaters, along with respective coverage, all under one roof. Evaluate your expenses and choose a plan that does not strain your yearly budget for investments.

Flexibility For Future Needs

Like life, medical requirements are dynamic. Ensure you choose a plan that is flexible enough to accommodate your changing health requirements with age, addition and deletion of family members, and medical advancements.

And the Winner Is..

Did you think there could be a winner? Any choice of health insurance plan depends solely on the needs and preferences of the policy buyer. For a small family coverage, a floater may be the best, but for diverse needs, an individual plan works in favour. So the key is to judge your financial status, examine medical needs and compare plans before locking in on one health insurance plan.

Related topics