Do you have your independent health insurance cover?

Everyone faces problems in life, be it a small worry or a crisis. Some are under our control and can be solved and some are not in our hands. I believe the two biggest crisis in life an individual can face is financial and health problems. The lack of financial resources could cause mental stress and affect health and likewise lack of good health can result in high medical expenses and cause financial stress.

The cost of medical treatment is increasing exponentially. Having a good health insurance plan with adequate cover can to a great extent lessen our financial outgo in terms of hospitalisation, diagnosis and medicine expenses.  When I ask my friends and relatives about medical insurance cover, the usual reply I get is I am covered under my company’s health insurance scheme. So they do not bother to buy a separate medical cover. However, there are some risks here.

Firstly, the medical cover provided by employer is going to last only till your work tenure in the organisation. If you resign or retire from the company, the medical cover is going to lapse. I remember one unfortunate incident of a friend’s father. He had resigned from his company in Mumbai and was going to shift to Pune to join a new employer. During the transition period in shifting to Pune, he suffered a heart attack. His medical cover with the earlier employer in Mumbai had lapsed and he was not having a separate insurance cover of his own.  Although he recovered from the attack by God’s grace, the financial burden he suffered was tremendous. It had repercussions for many years because all the long term savings were exhausted in his treatment.

Secondly,   there is a waiting period of 1 to 2 years on pre-existing diseases in health insurance plans. This means one cannot claim compensation in the event of some medical emergency up to two years. If your medical cover lapses, a fresh policy under a new employer will again have a waiting period on pre-existing conditions. Additionally, premium rates will be high as the age of the policy-holder would have increased then.

Thirdly, your parents might be left out from the insurance coverage although many employers offer group insurance covers which include the employee’s family members. Many group policies have age restrictions which do not cover people above the age of 60. They are also standard in nature and do not offer flexibility to the employee in terms of cover and other features. Thus, the cover might not be good enough to cover the number of dependants due to age limit and also in terms of sum assured given the high cost of medical treatment.  

To summarise, while a medical cover from an employer is a good back-up, it is advisable to buy an independent health cover directly from the insurance company. Buying a comprehensive insurance cover which suits your whole family as per their medical condition makes more sense.