Health insurance types, definition
Health insurance covers the medical expenses incurred on insured. Visit this page if you want to know more about health insurance along with its various types.
Definition of health insurance
It can be defined as a cover against the risk of any medical expenses due to any health problem. Thus it reimburses the medical expenses incurred on hospitalized of the insured. In other words, it is financial protection against any expenses on ill and unhealthy heath. The benefit is provided either by paying directly to medical institute from where treatment has been carried on or by providing reimbursement of medical expenses later on to the insured. These policies are popularity called as mediclaim.
There are many kinds of health insurance policies. Let's read about them in detail.Types of mediclaim policy
Personal health insurance
It is the simplest form of this type of policy. Under this, the person takes the policy for himself and it covers his hospitalization expenses up to the limit of sum assured in policy. Family heath insurance
As an opposite of above mentioned type, this policy is taken to cover medical expenses of whole family. Family includes spouse, children, parents, siblings, and/or any other dependent on the person applying for policy. The premium is comparatively lesser than personal health insurance. Group Health Insurance
Here, the person can take cover for a selected group of people. All the members in such group will get same and equal benefits. This type is mostly adopted by employers to insure their employees. The premium is also comparatively lesser than individual health insurance.Family floater policy
It is similar to family health policy but with option of floater in it. The benefit is provided to the family up to the amount of sum assured. A family member can claim benefit but then the cover will reduce accordingly in that particular year. To take an example, if the cover is of Rs. 8 lacs for a family of 4 members, and medical expense on treatment of a member is Rs. 5 lacs, then the cover will reduce to Rs. 3 lacs for that year. However, for subsequent years, it will be same as original i.e. Rs. 8 lacs. Since the probability that more than one member will fall ill in same year is very low, thus it is a very beneficial policy type for families. Unit Linked Health Insurance
Following ULIP, many companies in this sector has introduced Unit Linked Health Plan. It is a combination of insurance + investment. Return is paid back at the end of policy term which depends on current market conditions. However, it is preferable only for those who can manage with ULIP and ULPP. Critical Illness Insurance
Critical Illness Cover provides insurance in case any critical disease is diagnosed like AIDS, cancer, kidney failure, major organ surgery, paralysis, etc. Insurer provides reimbursement to the insured if such critical disease is diagnosed or on surgery of such disease. However, many companies decide some minimum survival period, i.e. days when the disease was diagnosed for first time after taking policy. It is also called as catastrophic illness insurance.