How Much Health Insurance Coverage Do You Need in India?

Healthcare costs in India are rising at an alarming rate. At the same time, more people are dealing with lifestyle diseases like diabetes, heart problems, and high blood pressure. This makes health insurance coverage the need of the hour.

While people understand its importance, many are still unclear about the amount of coverage they need. Getting too little coverage won’t help when big bills arrive, and getting too much might strain the budget. That’s why it’s important to know the right coverage to meet individual needs. 

Key Highlights

• Ideal health insurance coverage depends on age, location, lifestyle, and medical history.

• Individuals need INR 5-10 lakh, while families need INR 10-20 lakh coverage.

• Critical illness cover is essential for long-term, expensive treatments.

• Medical inflation demands future-proofing your insurance coverage.

• Employer-provided plans are not enough. Always have a personal health insurance plan.
  

How Much Health Insurance Coverage Is Needed in India?

What to Consider Before Finalizing Your Health Insurance Coverage?

The following factors will help you make the right decision. 

Location 

City plays a big role in healthcare costs. Metro cities like Mumbai, Delhi, or Bangalore have higher treatment costs than smaller towns. So, people living in such places require higher health insurance coverage to meet all eventualities. 

Lifestyle

Your daily habits play an important role in deciding on health insurance. Higher coverage is required when you don’t exercise or eat healthy. This is because a sedentary lifestyle increases the risk of lifestyle diseases. 

Existing Medical History 

Always check your medical history. People with diabetes or heart problems can choose the amount and type of health plan that offers them maximum financial protection. They can also go with add-ons like critical illness cover to enhance the coverage.

Inflation-Proofing Your Health Coverage

Medical costs increase by around 15% every year. A policy with a Rs. 5 lakh cover may not be enough in five years. So, always pick a health insurance coverage that will still be useful in the future. You can also add top-up plans later to increase coverage when needed.

Employer Coverage Isn’t Enough

Many people depend only on their company’s group health insurance. But this is risky. These plans often have low coverage and limited benefits. You may lose such benefits when you change jobs/retire. That’s why it’s a wise decision to have personal health insurance plans along with health policies offered by companies. 

Policy Benefits vs Premium

Don’t just choose the lowest premium. Always check what the plan offers. Look at hospital network size, room rent limits, daycare procedures, and pre/post-hospitalization costs. Many affordable health insurance options offer a good balance between premiums and benefits.

Customer Reviews and Claim Settlement Ratio

Always check what other customers say about the insurer. Look for reviews on the service, claim process, and support. Also, check the insurer’s claim settlement ratio. A high ratio means quick and fair claim settlement. This helps avoid problems during emergencies.

How to Calculate the Right Health Insurance Coverage?

Reema, a 30-year-old woman living in Mumbai, works as a software developer. She is a healthy person with no prior medical history. She plans to opt for a health insurance plan to safeguard her future. But like many, she is confused about the right amount of coverage. Here’s how she can make this decision. 

Step 1: Estimate Basic Hospitalization Costs

• The average hospitalization cost in a good private hospital for a day in Mumbai is between Rs. 60,000 and Rs. 1 lakh. 

Step 2: Add Critical Illness Cover

• Treatment of critical illnesses (like cancer or heart disease) can cost anywhere from Rs. 10 lakhs to Rs. 20 lakhs in India. 

• Little coverage won’t be enough to meet such an eventuality. 

• Reema can also add critical illness cover in her policy to boost the overall coverage. 

Step 3: Factor in Health Inflation

• A health insurance plan with a 10 lakh sum insured may be sufficient to cover today's needs. But it may not be enough to protect your wallet in the next few years. 

Step 4: Calculate the Total Coverage

• Considering the above factors, Reema should go with a health insurance plan with at least 20 lakh sum insured. 

Health problems can happen anytime, and money worries make them worse. The right health insurance coverage provides peace of mind in case of emergencies. With the rising medical costs in India, getting it on time will help you avoid big expenses later.