With the financial year drawing to a close, you cannot but come across agents desperate to sell you investment products with tax benefits — from mutual fund to life and general insurance plans.
Group insurance policies taken by employers just aren’t enough
MUMBAI: With the financial year drawing to a close, you cannot but come across agents desperate to sell you investment products with tax benefits — from mutual fund to life and general insurance plans. Wont you may be to say no to them, but see if any of them is offering mediclaim products, wherewith you could claim a deduction up to Rs15,000 for yourself and Rs 15,000-20,000 on premium paid for your parents.
Don’t ignore them thinking your colleague at the human resources department has just asked you to fill in your and your family’s details for the company’s mediclaim policy, so the office could take care of all your medical needs.
You may need a personal health insurance policy for reasons not stated in the company’s mediclaim policy document. Check the amount of cover that you have been offered under the mediclaim offered by your employer. This would depend on your designation and sometimes even the years you have served the organisation. In fact, with attrition rates shooting through the roof, employers are generally settling for a lower cover, say about Rs1 lakh, for most employees.
Now, that amount just won’t suffice if a major medical need arises, given that hospital expenses have been shooting through the roof of late.
Besides, this cover would be void if you leave the organisation, whether out of disgruntlement or for greener pastures. That could leave you without a cover between leaving your current employer and getting a fresh cover at a new organisation, if it offers one that is.
Mediclaim covers offered by employers come under group insurance, which are offered by the same companies that offer mediclaim polices for individuals. However, a group scheme preferred by one employer may not be preferred by another.
Besides, insurance companies have an initial waiting period during which no claims are accepted even when the policy is in force. So, if you make any claim during the first 90-180 days of the start of the policy, the claims would be denied by the insurer.
As a result, you would have no cover from the time you leave an organisation until the initial no-claims period of the insurance policy with the new organisation (if any) gets over.
What if a medical need arises during that period? Tragedy waits for ‘opportunities’ like that to strike - when you are least prepared - or so they say.
Most health insurance policies have a clause whereby pre-existing diseases are covered if a policyholder does not make any health claim for 4-5 years. You would lose out on all the benefits available to a person not making claims if you keep switching medical insurance covers with every job.
What’s more, there is also a discounted premium or bonus offered for the period a policyholder doesn’t make any claim. This would also be lost if you are a frequent job-switcher.
At any rate, mediclaim should not be a string holding you to an organisation.
Also, as you age and approach retirement, not only will you have no employer to give you a mediclaim, but not many insurance companies would be willing to give you a health insurance cover either. And if some company does offer a cover, the premium is bound to be an inflated one.
Ironically, no insurance agent would chase you to sell a mediclaim cover as he/she wouldn’t get a commission for selling a policy to someone over 55 years.
So, take a mediclaim cover before the sun starts setting on your health.
There are both general insurance and life insurance companies issuing health insurance covers. The general insurance covers would be valid for a year and would require renewals each year, while the policies issued by life insurance companies do not require renewals till the term expires.
The covers currently available range from those that meet only hospital expenses to those that also take care of major surgeries pertaining to the heart, kidneys, liver and gall bladder. Some policies, called critical illness covers, also provide a percentage of the sum assured on being detected with diseases specified.
d_khyati@dnaindia.net
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