In the last 18 months, the world around us has changed, completely! None of us would have ever imagined that the ongoing COVID-19 pandemic would wreak havoc on such a large scale. The pandemic not only affected the health of people globally but also destroyed jobs, global economies, and personal wealth significantly.
The only positive aspect of the pandemic is that it taught us the need and importance to secure one’s health at any cost. The last few months made us realize how important can health insurance be to secure the financial future against any unexpected medical emergency.
With the constant rise in the medical inflation rate, the best possible way to ensure quality treatment without breaking your savings is a comprehensive health insurance policy. A health insurance policy provides much-needed financial relief during medical emergencies like infection due to COVID-19 or any other health condition.
While people do realize how important is health insurance given unprecedented times like these, the severe financial constraints in many families due to the pandemic is making it difficult for people to invest in health insurance plans. Fortunately, with the timely intervention of the insurance regulatory authority (IRDAI), health insurance plans can now be bought in easy monthly instalments (EMI) - just like any other commodity.
The availability of health insurance in easy monthly instalments has enhanced the affordability of the product not just in metro cities but in Tier 2 and 3 cities as well. In fact, the demand for health insurance in easy instalments is much more in smaller cities than in metro cities as in smaller cities paying the entire premium, as a lump sum is a bit difficult due to single earning member in the family. Paying premium in a lump sum is also an important reason why many people go for a lower sum insured/coverage plans as they cost lesser.
However, when the need arises, the health insurance coverage falls short to meet the hospitalization expenses and most people have to ask for help from family and friends.
With the option of paying health insurance premiums in easy monthly instalments, the financial burden on customers is reduced and they can easily buy a plan with adequate coverage. Insurers now allow customers to pay the premium of their health insurance either on a monthly, quarterly, or half-yearly basis. EMI option in health insurance has made insurance affordable and accessible to all age and income groups.
Moreover, with the constant rise in the medical inflation rate, customers are bound to invest in health covers with higher sum insured to avail best possible treatment at their choice of hospital and city. By paying premiums in instalments, customers do not need to compromise on treatment. While earlier, for Rs 1 crore sum insured plan, a 30-year old individual had to pay Rs 11,000 – Rs 12,000 as a lump sum (yearly premium), the same plan can now be bought for a monthly premium of Rs900 – Rs 1,000.
The biggest benefit of the EMI option in health insurance is to senior citizens who mostly avoid buying health insurance either due to denial from the insurer or high premiums. However, it is important to understand that senior citizens are the most vulnerable group and are at the highest risk of getting ill. A comprehensive health insurance policy for older people is necessary to tackle medical emergencies efficiently without burning a hole in the pocket. EMI option in health insurance is an attractive option for senior citizens with limited income. Senior citizens can now pay premiums in easy instalments and ensure continuity of their health insurance coverage. The entire process of buying health insurance on EMI is very simple and convenient, as it involves no paperwork/documentation or pre-approvals.
If you pay the premium of your health insurance policy on a monthly basis and file a claim within the first six months of paying the premium, the insurer will still process your claim. The insurer may deduct the remaining instalments or may ask to pay the pending instalments as a lump sum to avail of the claim benefits. However, the overall claim procedure remains the same.
The author, Amit Chhabra, is Head-Health Insurance at Policybazaar.com. The views expressed are personal