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Family floater Vs personal cover

Soma Chakraborty, New Delhi
11/06/2018   0 Comments

With the rising healthcare cost and the growing awareness about the need for health insurance, more and more people today are opting for various health and medical cover. Choosing a right health insurance is crucial so as to avoid any unforeseen medical expenses. However, in most of the cases, first-time buyers are often confused between choosing a family floater and a personal cover. 
A family health insurance plan provides cover to all members of the family to the extent of Sum Insured, i.e, the maximum payout provided by an insurance company in a policy year. On the other hand, a personal cover is a separate insurance for a single individual with defined cover benefit.
Since the premium for the family floater plan is directly proportional to the age of the eldest family member, such type of insurance plan is best suited for young families.
In young families where members are aged less than 50 years, the chance of more than one member getting hospitalised in the same policy year is relatively low. Under such a scenario, each member can enjoy much higher coverage in compared to individual health insurance plan. For example, if there is a family of three (self, spouse and kid), there are two options. Either one can go for an individual cover with a Sum Insured of Rs 3 lakhs each or one can buy a family health insurance plan with Sum Insured of Rs 9 lakhs. Now suppose one member is hospitalised and the bill runs up to Rs 5 lakhs, the personal cover will pay up to Rs 3 Lakhs only and the rest Rs 2 lakhs will go from one’s own pocket. However, the family floater plan will cover the entire Rs 5 lakhs. 
Also, for young families, the premium for family health insurance plans is cheaper than multiple individual policies.

It is important to note here that under the family floater plan, children are covered only till the time they turn 25. After that, they will have to buy new personal covers but they will get continuity benefits for waiting period for pre-existing illness. 

Also if one has aging parents, it is advisable not to include them in family floater plans since, as mentioned before, the premium for the family health insurance plan depends on the age of the eldest member, it will shoot up unduly. It is always better to buy individual health policies for aging parents.

Another thing which one has to keep in mind while going for family floater is that the premium amount for the insurance plan also varies in case of pre-existing illness. So, even if a single member has any pre-existing illness that might require hospitalisation, the premium amount will increase. 

Different companies have different rules on this aspect. So it is advisable to compare the health insurance policies before buying. Since information regarding all health policies is available on Internet, comparing them won’t be a challenge. Also, several online portals are there which help customers to compare insurance policies. 

Though of course, one can always go for a personal cover for the specific individual with pre-existing illness, while other members can be part of the family insurance policy.

Since personal health insurance cover only one individual, it works best for those who do not have any dependent.  Even if one is covered under a corporate group plan provided by his or her company, he or she should go for a supplementary personal insurance cover because group health policies are generally small in size and in many cases do not cover an individual’s needs adequately. 
An individual health insurance policy augments one’s corporate cover and also protects an individual if he or she changes job. However, it is to be kept in mind that the more early one buys personal cover, the more beneficial it will be as the younger a person is, the cheaper is the insurance premium.  

As discussed earlier, individual health insurance plans are also recommended for persons with pre-existing illness. Also, as explained before, as one grows older, it is wise to go for personal cover as against family floater to avoid the burden of higher premium amount. 

Irrespective of which health insurance plan – personal or family floater – one goes for, it is important that the cover should be adequate.
Though buying the appropriate health insurance suited to one’s need is a cumbersome and a time-consuming process, the Internet has made it very smooth and fast. Today one does not need to rely on insurance agents and brokers or shift through lengthy literatures to compare and buy health policies. The Internet offers a fast, efficient, effective and transparent mode of delivery and one can easily buy health insurance policies online, directly from the company websites, without any hassle. 


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