The What, Why And When Of Health Insurance

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A lot of us probably wonder why we need health insurance when we are in the pink of our health. But as they say, life is unpredictable and you never know when the tables can turn. So its really best to get oneself a health insurance policy at the earliest.

Lets start with what health insurance is. Like any other insurance, this demands that you pool in your money at regular intervals, to conveniently incur medical expenses in the future. It is a way of protecting yourself against the medical costs that life has in store for you. If you ask what a good time to get yourself insured is, then the answer is yesterday, as you never know what today holds for you.

There are two broad categories of health insurances.
  1. Fee-for-service

    In this type of policy, the insured is admitted to hospital. The insured or his family is expected to pay the costs, such as hospital bills, medicine costs, ambulance charges etc, but can later claim the damages from the insurance company. This however, depends on the amount that the person is insured for. It also depends on whether the insurance company considers the medical expenses as reasonable or customary. If the expenses are more than the reasonable amount, you may have to make up for the difference yourself.

  2. Point-of-Service (POS)

    This type of health insurance policy features cashless transactions. Here, insurance companies have tie-ups with certain hospitals or doctors. Thus, if you go to the hospital that has a tie-up with your insurance company, you dont need to pay the bills as you are financially covered. However, even if you choose to go outside the network of doctors or hospitals, the plan covers about 80% of the costs.
    A lot of companies now-a-days are shifting to the cashless transaction method as it is more convenient option.

There are several other kinds of health insurance policies that vary from company to company. A full-service health insurance policy consists of an expensive premium but in times of need, it is worth every penny as it covers every medical expense of the insured regardless of the institution or the doctor.

Group health insurance policies offer health insurance to specified group of people such as employees of a company, members of a joint family, members of a co-operative society, groups of doctors, chartered accountants, etc.

Note: Health insurance types and its terms and conditions vary for different companies, thus read through different health insurance policies carefully, before opting for a particular one. There is no best policy. It differs on an individuals needs and preferences.
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