Different Types of Health Insurance Plans in India

Indian health insurance market is teeming with plans from basic mediclaim to specific covers. Choose a health insurance plan which is appropriate for you.

Did you know that there are various types of coffee in the world? And that they are classified? Most of the classifications are based on the presence or absence of ingredients. The other ways of segregation are by region and by methods of preparation.

But why are we talking about coffee? Well, just like coffee, health insurance can also be classified into types by various methods. At a broad level, there are two major types of health insurance:

1. Indemnity Plans

Indemnity plans are the more traditional flavour of health insurance. They indemnify or cover your hospitalisation expenses. This is done as per the limits, terms and conditions specified in the policy document. The maximum limit of indemnification is called the sum insured.

The following types of indemnity plans are popular:

Mediclaim Health Insurance

Mediclaim plans compensate you for the medical expenses incurred due to hospitalisation. The hospitalisation could be due to a disease, condition or an accident. Generally, these plans cover post hospitalisation charges along with hospitalisation charges. 

Hospitalisation charges include room rent, nursing, tests, procedures, consulting etc. 

Read along to know the popular variants of mediclaim:

Individual Health Insurance

This variant is popular among the young and single who have recently begun their careers. As you grow and have a family of your own, you have a choice. You can buy individual health insurance for every member of the family. 

However, the cumulative cost of individual policies for each member is on the higher side. ‘Now’ is probably a good time to switch to a health insurance solution designed to accommodate the entire family at an affordable premium. 

Read along to know what it is. 

Family Floater Health Insurance

A family floater health insurance is designed to cover your entire family. You may include your parents, spouse and children in the plan. A family floater allocates a common sum insured for the whole family. This sum insured can be less than the sum insured of all individual plans. This is because the chances of all the members of the family claiming in a year are low. Due to this, insurers can offer lower premiums for family floater plans.

But one disadvantage of a family floater is that it may mandate a copayment clause. This may happen if you include seniors in the plan. One solution to this is to have a family floater plan for the non-seniors members only. And have a separate senior health insurance plan for the senior members.

Group Health Insurance

Employers offer group health insurance plans to their employees. Since a large number of people are applying together, insurers tend to offer discounts on premiums.

Unit Linked Health Insurance

Unit linked plans are also known as ULIPS. Here, a portion of the premium is invested in the stock markets. Returns are a factor in the performance of these investments.

2. Defined Benefit Health Insurance Plans

In a defined benefit plan, the insured receives a lump sum on contracting an illness. Both the lump sum and the list of diseases covered are predefined in the policy document. 

The following types of defined benefit health insurance plans are popular:

Critical Illness Health Insurance

The incidence of lifestyle diseases is increasing these days. These plans are designed to mitigate the financial implications of critical illnesses. They cover critical illnesses whose treatment is typically expensive. 

Most critical illness plans cover conditions, such as:

  • Kidney Failure
  • Stroke
  • First Heart Attack
  • Major Organ Transplant
  • Cancer
  • Multiple Sclerosis
  • Paralysis
  • Coronary Artery Bypass

Hospital Daily Cash Health Insurance

Under this plan, the insured is paid a predefined amount every day that they are hospitalised. This is subject to the limits, terms and conditions defined in the policy document.

Personal Accident Health Insurance

The insured or their family is paid a fixed sum upon permanent disability or death. This is also subject to the terms, conditions and limits defined in the policy document.

With Hospitalisation Comes Medical Expenses

A sudden and unplanned hospitalisation of a loved one is challenging at many levels. Seeing a loved one suffer is hard enough. 

Often, it comes with the additional financial burden of heavy medical expenses. These expenses can burn a huge hole in your financial plan. It can be so big that it may take years to recover from it. 

Health Insurance Mitigates the Financial Burden

Health insurance can help you mitigate the financial burden of medical expenses effectively.

Mature Health Insurance Market

The Indian health insurance market has come a long way. We have various insurance products starting from mediclaim to specific covers, and the insurance market is teeming with various types of plans. Choose a plan that is most appropriate for your situation.

Now that you know Different Types of Health Insurance Plans in India, read more about the Fundamentals of applying for health insurance in India.

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