Types of Health Insurance

Health insurance policy is a cost-effective means of accessing healthcare facilities. Today, there are various kinds of health insurance plans and benefits available in the market. However, it is of utmost importance to choose a plan which suits you and your family. So let’s understand what are the different kinds of health insurance plans available to us. The health plans are divided into two major categories; indemnity plan and defined-benefit plan.
 
Indemnity Health Plan
Indemnity Plans are plans in which the intention of the insurer (insurance company) is to reset the insured (policyholder) to the financial status prior to incurring the medical cost. Indemnity type of health policies compensates the policyholders by reimbursing the actual hospitalization cost that is incurred by him or her subject to a maximum limit of the sum assured as opted by the policyholder. For example, if your sum assured is Rs. 5 lakh and the actual hospitalization cost incurred is Rs. 2 lakh, then the insurance company will pay Rs. 2 lakh as claim and not Rs. 5 lakh and if in case the cost incurred goes above 5 lakh, then the insurance company will pay Rs. 5 lakh as claims and nothing above that. There are two types of indemnity health plans.
 
 > Mediclaim Policies
This is one of the most popular and common types of health insurance plan. This type of plan usually covers the per and post-hospitalization costs, the cost incurred in lieu of surgeries, ambulance cost, room rent, etc. Though it is important to know what are the exclusions and capping under such policies to pick the one which would suit your requirements.
 
>Top-up Policies
Top-up policies increase your coverage amount. This is beneficial to cope with the deductibles in the health plan. Deductibles is that part of the policy which is not covered by the insurance company. So in such cases, the top-up plan comes to your rescue.
 
>Family Floater Plan
Floater means a single sum insured that covers all family members in one policy and the sum assured is available to anyone member or to all members in case of any eventuality during the term of the policy. This is one of the types of mediclaim policy where you can cover your whole family under one cover and the amounts claimed by any of the family members mentioned at the time of purchase of the policy would be paid from such a cover.
 
Defined Benefit Health Plan
Defined benefit plans are the ones with fixed benefits. These are exactly opposite to the indemnity plans. This kind of health plan pays a fixed amount irrespective of the actual expenses incurred. Say you have opted for the hospital daily cash plan which pays a fixed benefit of Rs. 3,000 for every day of hospitalization, then irrespective of your actual expenses, may it be Rs. 2,000 or Rs. 5,000, it will pay you daily cash of Rs. 3,000. There are two types of the defined benefits health plan.
 
>Critical Illness Plan
This kind of policy has gained a lot of attention in recent times. These are even provided by some of the life insurance companies. These are plans which provide specialized coverage against the specified list of critical illnesses. The list of critical illnesses differs from company to company. In this kind of plans, once you are detected with the critical illness as per the specified list under the plan, then the company pays a lump sum amount irrespective of the actual cost incurred.
 
>Hospital daily cash plan
You would rarely find a dedicated plan for the hospital cash. However, many insurance companies provide these plans as a rider which is over and above your mediclaim policy. It provides a fixed sum of money for each day of hospitalization irrespective of your actual cost.