Insurance has become an integral part of many societies. Insurance as a product was created to safeguard or protect a person, property, goods or assets from unforeseen mishap arising due to accidents or other catastrophic events. In developed countries people are quite aware and they take up insurance policies for their well being.
Insurance can be broadly categorised into Life insurance, General insurance and Health insurance. Life insurance policy is a contract between an individual policyholder and the insurance company where the insurance company promises to pay the beneficiary or nominee a sum of money in exchange for premium upon death of insured person. General insurance policies cover the property, automobiles and non life items under the policy contract. Health insurance is different from both life insurance and general insurance.
Health insurance policy is a contract where the insurance company promises to pay for medical treatment of the insured person in exchange for the premium paid. These policies are normally of short duration mostly of 1 year duration. Health insurance are commonly known as mediclaim policy. Some reasons for taking up health insurance policy are
- Rising medical costs for treatment of diseases – Due to modern lifestyle people face a number of health issues and it gives rise to many diseases ranging from common flu to critical types of cancers. As medical inflation is increasing day by day the cost for treatment of diseases is always increasing and it becomes unaffordable for a common man to take proper treatment. In such cases health insurance plays a vital role in protecting the individual from this high cost of treatment.
- Coverage of pre and post hospitalisation costs – Most of the health insurance available in the market come with pre and post hospitalisation cover meaning the cost involved before the actual treatment and cost involved after the treatment both are covered. Normally pre hospitalisation cost includes diagnosis tests, medicine cost, consulting fees etc. while post hospitalisation cost include medicine costs, nursing cost etc.
- Additional benefits like ambulance coverage, day care surgeries etc. – Due to advancement in medical field most of the surgeries, treatments are completed in short duration of time also called day care surgeries/treatment and you do not need to get hospitalised for the same. All these surgeries are also covered under the health insurance policy.
- Tax benefits – In many countries people are given incentives or tax benefits on the amount of premium paid by them for their health policies. This encourages them to have health insurance policy in place.
- Critical illness covered – Nowadays most of the health insurance policy cover all the critical illness like cancer, heart disease, arthritis, kidney failure etc.
To conclude as new diseases are emerging in the world the focus is now shifting to healthcare facilities throughout the world. It is the need of the hour that people take care of their health and pick up a good health insurance policy for themselves and their family.