Individual vs. Family Health Insurance Plans

Health Insurance

The benefits of health insurance are manifold. Be it ambulance costs, medical treatment expenses or hospitalisation charges, health insurance covers them all. There are two types of health insurance plans—individual health insurance and family health insurance policies. While the coverage offered by each remains more or less the same, who can avail of the benefits differentiates them.

Let’s get into the details of individual health insurance and family health insurance plans, and how to choose between them.

Individual Health Insurance

Individual health insurance policies are issued to an individual and are tailored to meet their needs. It means the insured amount can be utilised only by the policyholder. Individual health insurance makes routine healthcare affordable and covers expenses of critical illnesses if needed.

This plan is more beneficial when purchased at a young age. That’s because the premiums are relatively low and the likelihood of getting a bonus in the future is high.

Family Health Insurance

Family health insurance plans are designed to secure your family’s collective health. They provide coverage under a single comprehensive plan for all family members.

Remember, these insurance plans are largely generic and are not customised as per the medical requirements of each family member.

Also, under family health insurance plans, a fixed sum is assured for all the members of the family. For example, if the family health insurance plan assures a sum of Rs 5 lakh, then the maximum liability for the treatment expenses of the family extends to this amount.

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Normally, family plans are restricted to the wife, children, and dependent parents. Even so, in some cases, siblings can enjoy coverage under these plans.

Group Health Insurance Plans vs. Individual Health Insurance Policies

  • Definition

Individual health insurance provides financial coverfor medical expenses to only one person. Also, the entire assured sum is dedicated to his/her treatment.

Family health insurance plans are shared among family members. These policies come with a capped amount and if any family member utilises the entire sum assured, other family members do not receive the plan benefits.

  • Coverage

Family health insurance covers the entire family. This means that each family member can enjoy coverage benefits in cases of medical emergencies.

In the case of individual health insurance, only the policyholder receives cover up to the assured sum.

  • Premium Costs

You must pay monthly or annual premiums to the insurance provider to enjoy the benefits of health insurance. The premiums of family health insurance plans are computed after considering the age of the oldest family member covered.

For an individual health insurance policy, the premium is calculated based on the age of the person purchasing the policy.

If you compare coverage costs per individual,mostly family health insurance policies are more economical than individual health insurance plans. This applies more to nuclear families. However, if the eldest family member is an elderly citizen or if a family member has a pre-existing medical condition, then an individual plan is a better pick.

  • Pros

Individual health insurance plans are customised to suit the policyholder’s needs. The policy benefits are solely reserved for the policyholder.

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On the flip side, the main advantage of buying family health insurance is that the coverage is comprehensive. Moreover, such plans are cost-effective becauseall family members are covered under one plan.

  • Cons

Individual health insurance plans are not cost-effective since they are personalised to meet a person’s requirements.

In the case of family health insurance, one family member can deplete the entire sum assured. It means reduced coverage for other family members in times of emergency.

How to buy health insurance?

You can purchase health insurance offline by visiting the insurer’s office or reaching out to a direct agent. To buy insurance online, just visit the insurer’s website, fill in the form, follow the steps mentioned there, and make the payment. You will receive the policy document in your email inbox.

Buying online means a short turnaround time and bigger discounts on the premium amount.

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