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Help me Buy the Best Family Plan
The best way to keep your family safe from any financial burden arising out of hospitalisation and illnesses is to buy a health insurance plan. The family floater plans are health insurance plans which will cover you and your family together on shared basis and with no individual limit for each member covered under the floater.
The points given below will help you understand more about a family floater and the ways which you can choose the best plan.
Unlike, individual health insurance plan which covers individual members of the family, a family floater plan covers entire family in a single plan. It works with the assumption that all the members of the family will not fall ill at the same time, or will have the same hospital expenses. Thus, if any one of the members falls ill, the coverage up to sum insured (amount of cover, or maximum limit of the hospital costs to be reimbursed by the insurance company that you opt for your family) is available while the other healthy members are also covered. Thus, your entire family will have wider coverage with hospitalised members being supported by the non-hospitalised one. This makes the plan more beneficial for family insurance.
Normally, under a family floater the proposer, proposer’s spouse, a maximum of 2 to 4 dependent children (children financially dependent on the proposer), proposer’s parents, etc. are covered. However, there are a few special plans which offer extended coverage to other family members too.
Example: Say, Mr. Sharma opts for a normal family floater plan for sum insured or coverage amount of R. 3,00,000, then health expenses of Mr. Sharma, 2 to 4 of his dependent children and Mrs. Sharma or any one of Mr. Sharma’s parents would be covered under the same policy up to a maximum of Rs. 3,00,000. So Mr. Sharma’s wife is hospitalized and runs up a bill of Rs. 1,00,000, the family floater plan will be used up to Rs. 1,00,000. For the remaining year Mrs. Sharma and the others can still get covered in case they get hospitalized up to Rs. 2,00,000.
Honestly, just like you and your friend may not like the same cuisine of food, similarly a plan ideal for your friend may not be the best for you. It completely depends on your family and your individual requirements, financial needs and dependencies. Here are some points to help each one of you to choose the best plan for you:
In order to select the right sum insured value for your family, consider your family size. Choose a sum insured such that even if more than one family member is hospitalized there is some amount of sum insured left for other members too
Having a medical history of heart attack, medical history of gestational diabetes, chain smoking habit, etc. which are likely to increase health expenses too, are considered as risk factors while determining the premium. Presence any of these factors in even one of your family members covered under the floater will increase your premium (also known as premium loading*). Also, there are possibilities that the person with such risk factors will use up a larger part of sum insured in a policy year with little or no amount left for others in the floater.
Thus, it is advisable to buy a floater for individuals with no such risk factor and an individual policy for individuals with such risks.
Example: In a family of 4 members A, B, C and D family member A has a history of heart attack then, there would be premium loading or increase in the premium cost. Besides affecting waiting periods on certain diseases for all the members there would remain a high possibility that the member A uses up the maximum sum insured value. Thus, it is advisable to cover A in a separate individual plan.
Note: Premium loading is the increase in the premium value on account of the condition that the individual covered in the floater has pre-existing health condition or history of some serious illness.
So when you choose a family floater plan involving much older individual (above age 60 years) compared to other members (up to age 35 years) then there are possibilities that a larger part of sum insured would be used up by this elder member. Thus, it is advisable to buy a separate plan for this member. However, all the other members in a similar, younger age group should be covered in the floater plan.
Example: In a family of 4 members is covered under a floater where:
There is a high possibility that member C who is 60 years old will use up the entire sum insured in a policy year. Thus, buy a separate individual policy for C and a floater plan for the rest of the family.
Some of the important policy terms that should be considered in a family floater plan are:
All the health insurance companies are associated with certain hospitals where they offer cashless treatment. These are known as network hospitals.
Thus, while you look out a health insurance plan, check if the network hospital list of the company includes name of your preferred hospital.
Note: Cashless treatment is when the insurance company settles all the hospital bills directly by coordinating with the hospital so you don’t have to pay anything at the time of treatment.
Co-payment or co-pay is the percentage of claimable hospital expenses you have to pay out of your pocket. Although, this option lowers the premium amount, it is advisable to avoid it if you do not want to make higher out-of-pocket expenses during each claim.
Example of plan with co-pay: Consider if you have a plan with sum insured Rs. 1,00,000 and 10% co-pay. Your claimable hospital expenses are Rs. 1,00,000 then you have to pay Rs. 10,000 only after which your expenses would be covered up to sum insured.
Note: A co-pay option does not reduce your coverage amount.
Some plans have an agreed deductible value which is nothing but fixed amount that you have to pay out of your pocket before claiming for insurance. These plans with deductible are also known as top-up plans as you can opt for these plans in addition to your regular health plan. The premium amount for these plans is very low.
Since, more than one member is covered under a family floater, the chances of sum insured getting exhausted are higher thus top-up plans provide extra security to your family.
Additional information on top-up plans: The top-up plans have two variants a regular top-up and a super top-up. The only difference between the two is the threshold value or compulsory deductible. This value states the amount above which the top-up plan would be activated.
In a regular top-up plan you have to exhaust the deductible value in a single hospitalization. However, with a super top-up plan you can exhaust the deductible value in multiple installments.
Example of a plan with deductible: If an individual has health insurance family floater plan of Rs. 2,00,000 he can additionally have a top up plan of Rs. 4,00,000 with deductible Rs. 2,00,000. After the family floater of Rs. 2,00,000 is exhausted one can use the top-up plan to overcome the expenses.
Some of the plans have defined limit (also known as capping amount) up to which your room rent per day would be covered while some others companies define the room type for which your expenses would be covered. Both these plans are considered to have room expense limit. If you opt for a plan that limits your room expense, and by some chance if you exceed those limits then, you have to pay for this exceeded amount from your own pocket.
Once your plan has a room expense limit then even if your claim amount does not exceed the sum assured, you still have to bear additional exceeded room cost. This exceed cost will not just be the room rent but also the additional doctor fees, nurse expenses, etc. which increases with the increase in room expense.
In the course of treatment there is a possibility that you exceed the room expense limit due to unavoidable circumstances such as non availability of rooms within your room limit. To understand this better please refer to this link.
It is advisable to avoid plans with limit on room expenses.
Example of a plan with limit on room expenses:
Example 1: You opt for a plan which states room expenses for only general ward will be paid and following are the charges:
|Room type||General ward||Private|
|Room charges (INR)||1000||60,000|
|Heart surgery (INR)||2500||1,00,000|
Consider that you opt for this plan which pays only for general ward. Then, if you opt for treatment in shared ward which has higher expenses then, the difference in expenses is something that you will have to pay out of your pocket. So, precisely you will have to pay Rs. 1,500 (exceeded room rent) and Rs. 40,000 (exceeded surgeries charges because of room change).
Example 2: Your policy states room rent limit of Rs. 3,000 for sum insured of Rs. 3,00,000 and following are the charges:
|Room type||General Ward||Shared||Private Deluxe|
|Room charges (INR)||1000||2500||4000|
|Heart surgery cost (INR)||60,000||1,25,000||2,00,000|
Consider that you opt for treatment in a private deluxe room with room rent on Rs. 4,000. Then, the difference in expenses is something that you will have to pay out of your pocket. So, precisely you will have to pay Rs. 1,000 (exceeded room rent) and Rs. 75,000 (exceeded surgeries charges because of room change).
Some companies reward you for no-claim by offering a no-claim bonus for a particular year. This bonus is percentage increase in sum insured value at renewal. With conditions such as you should not change the type of policy.
After claim, this bonus amount reduces to basic which is your original sum insured. Please refer to the policy document for the details of these values for your policy.
Some companies also offer a discount on the premium amount that you need to pay during renewal. In this case too after claiming for a particular year the discount offered would not be valid. Please refer to the policy document for the details of these values for your policy.
It is better to have at least one of these rewarding features on no-claim.
Example: You have a floater plan of Rs. 3,00,000 with no-claim bonus of 5% then at renewal your sum insured value increases to Rs. 3,15,000. However, after claim the sum insured will reduce to basic of Rs. 3,00,000.
The premium discount also works on similar lines.
This benefit ensures that after entire sum insured is exhausted, the basic sum insured (does not include the bonus unless specified in the policy document) is automatically restored for re-utilization.
Since, all the members of the family have shared sum insured value it is advisable to have plans with restore benefit. Please refer to the policy document for the details of these values for your policy.
Example of plan with restore benefit: Consider family members A, B and C are covered under a family floater with restore benefit and the entire sum insured is utilized by member C for hospitalization against malaria. Then, in this case, the sum insured will be restored to basic.
Condition: This restored amount will be available only for member A and member B. However, C would be covered for any condition other than malaria.
Your premium changes if:
The eldest individual in the floater moves in a different age bracket. Then, the premium amount increases during renewal.
Example: All the plans have defined age bracket above which the premium value changes. Consider that your plan has age bracket between 25 years and age 29 years and the eldest member of your family is 27 years old. Then, you pay same premium up to his age 29 years and as he moves up to age 30 years the premium would increase.
The company changes the nature of the product and certain features. Then, the premium amount may increase or decrease during renewal.
Note: You will be intimated about such changes and they won’t happen frequently every year, as these changes need to be sanctioned by IRDA.
You do not claim during a policy year and if your policy offers premium discount on no-claim (mentioned above) then your premium would reduce during renewal.
Example: Consider that your plan offers a premium discount of 5% on no-claim then on renewal you will get 5% discount on premium value.
|Benefit||Individual||Family Health||Family Floater|
|Sum insured/ Coverage amount||The entire sum insured is available for only for one individual.||A separate sum insured & a plan covers each member.||One sum insured & plan covers all members of a family.|
|Premium||The premium that covers the insured person is determined by the age of the individual||The separate premium for each members & the amount depends on the age of each member.||One premium to get all the members covered and the amount depends on the age of the eldest member of the family and number of members covered under the plan.|
|Claims||With a claim, the individual is compensated with the sum insured amount. If there is more than one claim a year, the individual is left with no cover.||If there is more than one claim a year, members are compensated with their individual sum insured amounts without affecting the other members’ sum insured amounts.||If there is more than one claim a year in a family, the other family members are left with little or no cover|
|Number of members||You can buy the individual health insurance package for yourself or for any single family member||You can buy a same individual plan for all the members of your family and get them covered under family health insurance.||Many insurers have a limit on some adults covered under same family floater plan. Hence, you may not cover all the members of your family with a floater.|
|Ideal for||Individual person having high health risk.||Families with older members having a high health risk.||Families with older members having a high health risk.|
|Insurer||Plan||Sum insured (in lakh Rs.)||Benefits|
|Religare||Religare Care Policy||3/4/5/7/10/15/20/25/50/60||- Recharge or Restore benefit up to 100% of sum insured|
- Annual Health Check-up irrespective of claims
- No-claim bonus
|Apollo Munich||Optima Restore||3/5/10/15/20/25/50||- Multiplier benefit |
- Restore benefit up to 100% sum insured
- Health check-up after 2 policy years
- Option to buy critical illness rider benefit
|Star Health Insurance||Mediclassic individual||1.5/2/3/4/5/10/15||- Restore benefit up to 200% of sum insured |
- Option to opt for hospital daily cash and patient care cover
|Max Bupa||Health Companion||2/3/4/5/7.5/10/12.5/15/20/30/50/100||- Optional Voluntary deductible |
- Cost of prosthetic up to sum insured
|Oriental||Contnent R2C2||1/1.5/2/2.5/3/3.5/4/4.5/5/6/7/8/9/10||- Basic policy |
- Option to opt for voluntary co-payment
- Daily hospital cash
|HDFC Ergo||Health Suraksha||3||- No sub-limits on room rent expenses |
- No-claim bonus