Five Reasons Your Corporate Health Insurance Isn’t Enough To Protect Your Family 

*This is a sponsored feature by ICICI Lombard General Insurance Company Ltd.

If you’re one of the few Indians with a health insurance policy, congratulations - you’re already a step ahead of most people. Only 18 percent of people in urban India and 14.1 percent of those in rural areas have any kind of health insurance.

You may be patting yourself on the back because your employer provides insurance.

But few people read the fine print in their corporate policy or understand how much medical treatment really costs in India.

Indians are learning the hard way that holding one insurance policy linked to your job may not be enough. There are many reasons to have independent health insurance to supplement your employer sponsored coverage, but the main one is that most corporate plans simply don’t offer a high sum insured.

Here’s why you should take a closer look at your corporate plan and consider a separate health policy.

1. Corporate Coverage Ends When You Leave Your Job

The most important reason to have an independent health insurance policy for you and your family is that, with a few exceptions, most people don’t spend their entire lives with the same employer.

You may switch jobs only to find that your new company doesn’t offer a health plan. You may decide to start your own business, which means no perks and benefits. Or you may, unfortunately, lose your job through no fault of your own.

If there’s a gap between the time you leave one employer and begin working at another, you’re not entitled to any corporate coverage. Few people think about what can happen in the period between jobs, whether it’s one week or one month. A medical emergency can happen at any time, and a private insurance policy will help you regardless of your employment status.

2. Paltry Sum Insured

People are living longer, which means seeing inflation and increased health care costs eat away at whatever sum insured they may have.

Most group insurance plans do not come with a high sum insured. Group policies are usually in the single-digit lakhs, which isn’t much for a family of four. Even if you don’t have dependents, you should consider what would happen if you did. Your parents may not have any insurance at all. An independent policy can cover everyone under a family floater.

Corporate plans are also rarely revised. Even if you stay in the same job for years, it’s possible that your health insurance coverage may remain stagnant.

One accident or serious illness is enough to wreak financial havoc. Heart bypass surgery in India can cost more than Rs 3 lakh, and the cost of such procedures is rising (by 18.38 percent in Bengaluru and 14.75 percent in Kolkata). Urban areas are usually pricier, and if you factor in the choice of public or private hospitals, ambulance transportation and private hospital rooms, a Rs 2 lakh family floater can quickly disappear.

3. The Fine Print Can Be Restrictive

In addition to offering a minuscule sum insured, insurers may have other conditions that limit their responsibility to you.

They may not cover all of your dependents. Sub-limits on hospitalization, diagnostic tests, and ambulance charges mean you have to pay for part or all of these yourself once you cross a certain threshold. Some requirements, such as post-operative treatment or home care, may not be included at all.

There’s also the possibility that your employer stops providing health insurance altogether or reduces the level of coverage. When companies cut costs, employee benefits are often the first things to go. Your terms of employment can change at any time.

4. Retirement Makes It Harder To Secure Health Insurance

Everyone has to stop working at some point. Getting your first insurance policy after you retire will be an expensive affair - maybe even an impossible one if insurers decide you’re too much of a risk.

Many policies also have an age limit. Once you hit 50, insurers consider you more susceptible to health problems or likely to have pre-existing diseases. This means you’ll have to undergo a battery of medical tests beforehand and may have to shell out a lot of cash for a policy, if you’re lucky to get one at all.

That’s why it makes sense to have a health insurance plan early in your working life. Some insurers offer features such as lifetime renewal and no co-payment as you get older.

5. Private Plans Come With More Perks

Not only do non-group health insurance policies offer you a range of coverage amounts, but they also come with additional advantages.

ICICI Lombard offers a free health check-up every policy year, lifelong renewal and a no-claim bonus of up to 50 percent for every claim-free year. It also provides unique add-ons such as maternity and newborn cover for prenatal, delivery and postpartum expenses.

The premium paid toward your health insurance policy is also tax deductible under Section 80D of the Income Tax Act. While the number one reason to buy insurance is protection, a tax break is always welcome.

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