An unexpected illness or accident could make a dent in your bank accounts and make your financial plans go haywire. With ever-rising costs of medical care, making health insurance is important not only for yourself but for your loved ones as well. As everyone is different, so are their needs. Your health insurance should be decided upon after careful consideration of following factors:
An unforeseen disease or accident could make a scratch in your financial growths. With always increasing expenses of medical fees, making health care coverage is significant for yourself as well as for your friends and family also. As everybody is unique. Your medical coverage ought to be settled on after cautious thought of following elements:
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Annual Income Percentage Annual earnings is immediately proportionate to the medical health insurance cover. Your annual earnings is a thinking about issue through the insurance providers, while figuring out the most medical health insurance cover you’re eligible for. Practically, you must have medical health insurance cover among 50% to 100% of your annual earnings. A easy however beneficial formulation is:
Premium Payment Terms Your financial ability to pay premium is an important factor while deciding the extent of health insurance cover that you will need. Not everyone can pay the premium for Rs 20 lakh cover, however, you can pay what you can afford. A good way to calculate that is by taking 2% of your yearly income – for example, if you earn Rs 6 lakh a year, you might be able to pay an amount of Rs 12,000 yearly which will give you a decent cover from today’s standard.
Family Medical History Family history is another factor that affects your health insurance cover. The insurer will look at the history of health problems of your family members in order to evaluate the risk of the insured contracting the same. Individuals falling under the high-risk category should get a comprehensive high cover health insurance policy.
Age of the Insured Age is another important factor that will affect your health insurance coverage. Individuals who have bought health insurance policies while young avail a discount on premium. For example, if you start at age 25 you can buy health insurance worth Rs 5-10 lakh and then increase it by 10-15% every year. And individuals over 45 years of age would have to pay higher premium for health insurance coverage.
Type of Hospital The health insurance cover is also affected by the grade of hospital where you choose to be hospitalized. The rate of same treatment differs in different hospitals. So, the amount of health insurance cover that is needed has to be determined by calculating the expenses that might incur from the hospital of your choice.
Tax Benefit When you avail a health insurance policy mainly for the purpose of tax benefits, then you need not take a comprehensive health insurance cover. You can evaluate the amount of tax deduction you wish to avail through the policy and then purchase one that meets your requirement. The maximum limit for 80D deduction is Rs. 25, 000, and Rs. 30,000 for senior citizens.
Disclaimer The parameters provided above are only indicative and it may vary from person to person and case to case.