Often people covered under a group health insurance policy ignore the importance of having an individual health insurance policy. This could be a costly mistake, especially as you grow old. This is because your employer is not bound to offer you health insurance coverage and if you end up working in such a company you might get entangled in financial stress at the time of medical emergency. Here are nine reasons why it is not a smart move:
The coverage under the group health plan may change year to year. Often when premium rates go high companies curtail the benefits by introducing co-payments or excluding parents in order to cut their costs. Recently group health insurance premium rates have gone up through the roof amid the second wave of Covid-19. In some cases, the rates have gone up as high as 80%. In such a scenario many corporates may opt for reducing premium by curtailing benefits. It is therefore always good to have your own health insurance plan to save yourself from such knee-jerk reactions.
The coverage offered under the group term plan may not be adequate to cover your entire family. A separate plan with an adequate sum insured can give complete protection to your family at the time of need. At the time of Covid, when healthcare has been expensive, experts say one should have a cover of at least Rs 25 lakh for the complete protection of the family.
We have seen the cost of group health insurance policies rising by 10-80% during the second wave of Covid-19. At times to cut their cost, the employer may reduce the sum insured or may ask the employee to share the premium rates. If you have sufficient coverage from the start you can opt-out of the group covers if you find them costly.
When you leave your job your health insurance cover also stops immediately. It is therefore important to buy a cover when you are young. It is not only cheaper but also gives you the advantage of completing the waiting period when bought early. Having no cover after retirement might leave you exposed to risk of the high cost of treatment at the later of your life.
You remain uncovered when you are between jobs. If during that time any medical emergency comes then you will have to foot medical bills making a dent in your savings. It is therefore advisable to have a separate plan which keeps you covered even during the transition time.
When you have a separate health insurance policy, you get the benefit of accumulating no claim bonus or NCB. It gives you a higher coverage for each claim-free year. By buying a policy at an early stage you can increase the sum insured by accumulating NCBs.
Most importantly, with individual health insurance, you have the option of customising it according to your needs as you can choose the type of policy depending on your needs. For example, if a person has a history of diabetes or cancer in the family, he or she can opt for these disease-specific plans.
If you buy early then premium rates will be much lesser. Moreover, you run the risk of the insurance company denying you the cover as the risk of falling sick gets quite high as you grow old.
Individual health insurance plans can be renewed for a lifetime. Your group insurance policy will stop covering you and your family as soon as you change or leave the job. For long term benefits, it is advisable to buy a separate policy with lifetime renewability.
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