Health is wealth. We mean it both metaphorically, as well as literally. Metaphorically, because health is priceless. And literally, because now you need sizeable funds to meet the financial repercussions of any medical emergency that rings your doorbell. All thanks to the improving medical infrastructure and the rising health costs.
Although you can do nothing to avoid medical emergencies, you can invest in health insurance plans to take care of such emergencies when the time comes. Even though health insurance is not necessary, it sure is a must-make purchase.
So, if you have not purchased health insurance plans, you should. We'll give you all the reasons why. But before that, let's cover the basics, shall we?
What are Health Insurance Plans?
Health insurance plans work on a contract between the insurer and the insured, wherein the insured must pay premiums for a year or more. In exchange, the insurer pledges to cover medical bills up to a certain limit. Basic health insurance plans cover pre- and post-hospitalization, medical bills, and consultation fees, to name a few.
Why are Health Insurance Plans a Necessary Investment?
Now that you know the basics of health insurance plans, let's discuss why they are a necessary investment:
1. Ensures Financial Protection for you and your family:
Health insurance plans are necessary if you want to keep yourself and your family financially protected in the face of adversities. You can depend on your life savings for sure, but there are a whole lot of areas you can use - to repay your loans, pay for your child's education, or fulfil your retirement dreams and whatnot. As for health insurance plans, they serve only one purpose – protecting you against the financial catastrophes that come with various health issues. You can depend on health insurance plans for this purpose.
2. Medical Emergencies Don't Come without a Warning:
Unfortunately, most individuals do not invest in health insurance plans assuming they do not need them. But truth be told, there's no fixed timeline for diseases and accidents. They come in unexpectedly without giving you any prior warning. That's why it's essential to be prepared for them if and when they come. You can be in the best of your health, but you won't be immune to illnesses and diseases. Even the fittest individuals need a doctor's appointment at some point in life. Therefore, investing in health insurance plans is essential to protect yourself and your family financially and healthily. You can also consider investing in personal accident insurance to ensure extra financial benefits in the face of accidental adversities.
3. Health Insurance Plans Can Help You Save Money Significantly:
If you consider health insurance plans an expense, you are on the wrong foot. Consider health insurance plans as an investment instead – your investment into the future, your investment into protecting yourself and your family in medical emergencies, your investment into helping them have the best health.
Moreover, what you spend on health insurance plans is minimal compared to the coverage they offer. For instance, if you spend INR 20,000 as a health insurance premium, you can get coverage for an amount as high as 10 Lakhs.
Last but not least, health insurance plans cover more than just your hospital bills. They can cover medical costs, doctor's prescription fees, ambulance charges, offer a daily allowance, and a lot more, depending on the health insurance plan and the provider you have chosen. In short, they can help you save money significantly in the long run.
Therefore, it's an essential purchase and a financially sagacious decision.
4. They Help you Save on Taxes:
Those of us who fall in the higher brackets of tax slab rates keenly look for ways to save taxes. So, if this seems familiar to you, we got good news. You can save on taxes if you invest in health insurance plans. As per Section 80D of ITA, premiums paid against health insurance are tax-deductible. This means they won't be included when calculating your taxable income.
For instance, if you pay INR 20,000 as health insurance premiums annually, and your income is INR 5,00,000, the tax will be calculated on INR 4,80,000 (5,00,000 – 20,000).
Please note the maximum limit of tax benefit is INR 25,000.
You can have a sizeable savings, but it still won’t be enough if God forbid, you meet with a medical emergency. Even though the Government of India hasn’t made it mandatory to purchase health insurance plans, it’s advisable that you do if you want to ensure a quality medical treatment for yourself, or your family, without worrying about the huge medical bills.