MEDICAL costs have been rising fast over the years. The health cover that you bought a few years ago, might not be enough at the current stage due to rising medical costs. The real problems starts when you cross the age of 50, as this is the time you need health cover the most. Given the current rate of inflation in medical costs, the cover you bought years ago may not be able to support even half your medical bills. Here is an example. If the cost of heart surgery today is Rs.2 lakhs, 15 years down the line it could be as high as Rs.16 lakhs, if we assume a yearly rise of 15 per cent. Rising premium rates is another issue. The fact is Doctors’ salaries go up, Rentals go up & logically hospitals increase their cost. Thus your premium has to go up. Are you ready to bear the burden? Will your health insurance policy be able to support you during the later stages of your life? It is important to get the answers right.
You may think that you will increase the cover as you grow old. But here’s a catch. The health insurance company will obviously charge a higher premium when you are old due to your age, lifestyle or existing diseases. It is, therefore, a wise decision to buy health cover at an early age, say, by the time you are 30 or 35. Moreover, you do not have to go through medical tests when you are young.
How much cover should one buy? Many people think Rs.4 lakhs is enough as the sum insured will automatically get doubled in five years if they do not file any claim during this period. But will it be enough given the rate at which medical inflation has been rising? No experts say that given the cost of treatment and rising inflation one should not buy a cover of less than Rs.10 Lakhs. The right amount however can be arrived at only after considering factors such as medical history, number of dependents, the city one lives in etc. The minimum health cover is individual and should be between Rs.5 lakhs and Rs.10 lakhs. Here is the low down on how to decide the sum insured for your health policy.
If there is a history of illness in the family that can be inherited, one must take this into account while doing the math to find out the cost of treating these and accordingly increase the sum insured.
Medical costs differ from place to place. The cost of hospitalisation is much less in smaller cities. As per the Insurance Information Bureau, the average claim size in Hyderabad is Rs.38,192, While in metro cities such as Mumbai and Delhi it is Rs.46,806 and Rs.40,179, respectively.