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Is Health Insurance Just A Tax-Saving Tool? Read on to Know the Answer

Published On Nov 26, 2019 5:30 AM By Prashant Srivastava

Just like life insurance, health insurance acts as an efficient tax-saving instrument. But considering it just a tool to save tax is a myth. Health insurance enables you to get the best medical care without any strain on your finances. It protects you and other insured members from expenses incurred on hospitalisation. The key benefits of health insurance are that it covers medical expenses related to pre and post hospitalisation, daycare procedures, inpatient treatment, domiciliary treatment, ambulance services, medical tests, and many others.

Listed below are certain factors that state that health insurance is not merely a tax-saving tool but more than that.

  • It secures the health of your family
  • It saves your savings when medical costs are increasing
  • It prepares you to deal with lifestyle diseases
  • It pays you a lump sum amount up to the sum insured in case of critical illnesses

Click to Understand Section 80D of the Income Tax Act and Its Benefits on Health Insurance

Helpful During Medical Inflation

The medical inflation in India has been skyrocketing steadily and more alarmingly - in fact, double the rate of overall retail inflation. A scary high, isn’t it? In the absence of a health insurance policy, medical expenses can break into your savings because costs of medical tests, room rents, doctor’s fee, etc. can run into lakhs of rupees.

On the other hand, if you keep your family adequately cushioned under an adequate health insurance policy, you don’t need to worry about the high medical costs as all the expenses incurred on hospitalisation are borne by the insurance company. So, buy health insurance today not just for saving tax, but also to deal with unforeseen situations.

Securing You and Your Family

A good mediclaim plan not just secures you, but also your entire family members who are dependent on you. A family health insurance product takes care of the health care needs of the entire family members. However, for a family benefit, you need to invest in a family floater cover. Though buying a separate policy for every individual member can be a solution, but the premiums will be very high. So, going for a floater policy instead of individual policy for every member is better.

A family floater policy provides coverage for yourself, your spouse, and children. Some policies also cover in-laws of the family if they are dependent. If there are senior citizens in the family, go for a separate plan for them to reduce the premium amount.

Some of the popular family floater policies are Optima Restore Family, Health Suraksha, Family Health Protector, Family Medicare Policy, Care and so on.

For a special cover, you have the option of add-on cover, riders or top-up plans by paying a little extra.

Combating Lifestyle Diseases

As per the report of GOQii titled India Fit Report 2019,

  • Blood pressure has seen a spiky by 90% among people under 45.
  • Diabetes too has increased by 40% among individuals in the same age group.

Lifestyle diseases have found their way into every Indian household due to the sedentary lifestyle and unhealthy eating habits.

2019 Top 10 Health Insurance Policies with Tax Benefits

Besides, keeping a check on your fitness and diet, you also need to prepare financially for any emergency.

This is where a substantial health insurance policy is crucial to have. Different types of policies are available in the market. Going for regular health insurance with an adequate sum insured is always recommended. There is hardly any replacement for a comprehensive plan with an indemnity cover. There are also plans that cover lifestyle diseases such as Diabetes Safe and Cardiac Care by Star Health Insurance, Energy by Apollo Munich for individuals suffering from diabetes Type 1, diabetes mellitus Type 2, pre-diabetes (IFG, IGT) or hypertension.

Dealing with Critical Illnesses

No doubt, we’re standing at an increased risk of falling prey to critical illnesses.

1 out of 4 individuals in India is at risk of dying before 70 due to lifestyle diseases and non-communicable diseases such as cancer or cardiovascular ailments.

A healthy diet plan and sticking to regular exercise can help you. But the chances of these unwanted ailments increase due to hereditary reasons and mostly age factors.

Unlike regular health insurance, critical illness plans (CI plans) cover you against dreadful life-threatening diseases like heart attack, total blindness, paralysis, cancer, stroke, renal failure, kidney failure, liver failure, coma, etc. They pay you a lump sum amount in case of critical illnesses.

The lump-sum can be used for the treatment expenses. The policy pays to the insured a lump sum amount, equal to the sum insured if he or she is diagnosed with one of the specified critical illnesses. This amount can be used for the treatment or meeting other financial needs. So, investing in a suitable health policy not just saves taxes, but also helps you take care of all expenses related to diseases.

Some of the CI policies are iCan Cancer (Apollo Munich), Cancer Care Gold, Criticare Plus (Star Health Insurance), Criticare (Max Bupa), Critical Illness Plan (HDFC ERGO), Critical Illness Insurance Policy (IffcoTokio), UNI Criticare Policy (United India Insurance), and many others.

Final Opinion

After discussing the health benefits of a health insurance policy, we can conclude that a mediclaim plan is not just for saving tax, but its major role is to financially help when a medical emergency strikes. It has a greater role to play when it comes to securing your family health.

To buy the best health insurance policy, initiate a call at 1800-120-5698. 

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