Compare Individual and Family Floater Health Insurance Plans

Whenever you have heard about health insurance you must have heard about these two types of health insurance policies – individual health insurance plans and health insurance plans for family. Here we will talk about what is health insurance for family and how it is different from your individual plan.

Purchasing an individual health insurance policy means that you have a separate medical insurance cover for every individual with a defined sum insured. While this is fine when you are alone, buying individual health insurance plans for every member of your family becomes an expensive affair.

Health insurance plans for family, also known as family floater policies, basically have a common, higher, sum insured amount which is shared among all the members of your family. In effect, you are purchasing a single health insurance policy and are sharing it among your family members.

Tip: Most family floater policies allow you to cover a maximum of 6 persons. Apart from yourself, your spouse and your children, you may add your parents or parents–in–law in the policy too.

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Click to read: IRDAI has reduced the waiting period for pre-existing diseases from 48 months to 36 months and the moratorium period from 8 years to 5 years from April 1^st, 2024

Advantages of Family Health Insurance Plans

Your family health insurance plans incorporate in themselves all the features and advantages offered by your individual health insurance plans like cashless claim facilities, daily hospitalisation cash allowance and tax deductions under section 80D of the Income Tax Act, 1961, and offer additional advantages on top of that. Let us read about these advantages:

Higher Sum Insured: Your family floater health insurance policy usually comes with a higher overall sum insured in comparison to your individual health insurance plan.

Greater Medical Coverage: Your family members are covered for more benefits under health insurance as your family floater plan is a comprehensive health insurance policy covering all expenses relating to planned hospitalisation as well as for medical treatment in case of an emergency. You may also avail of the annual health check-up facilities for every member additionally offered by the insurer.

Flexibility: Family floater policies offer greater flexibility in terms of coverage. You have the option to add and remove family members during the policy term. Additionally, some policies allow you to extend your coverage to your in-laws too, customising the coverage offered by the policy.

Ease of Management: It is easier for you to manage one family floater policy in comparison with as many as six individual health insurance policies. Keeping track of the premium due dates for all the individual policies and the sum insured exhausted from each in case of claims is a cumbersome process.

Cost Effective: What is health insurance? In a nutshell, it provides a cover in return for a consideration, known as the premium. As a family floater policy is essentially a single health insurance policy being shared between multiple members of your family, the premium is substantially lesser in comparison to the sum of all the individual policies.

Continuous Coverage Over Multiple Years: Most family floater policies have the option to buy or renew for up to three years. This provides your family with continuous coverage and you also gain as health insurance companies offer you discounts when you pay for multiple years at one go.

Pro Tip: Explore online payment options from your insurer’s website to avail of further discounts

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Click to Read: How you should look at and understand the Claim Settlement Ratio (CSR) of a Health Insurance Company before buying a Policy

Disadvantages of Family Health Insurance Plans

Your family floater plan comes with certain disadvantages too:

Exhaustion of Sum Insured Limit:

In a family health insurance plan, the total sum insured is shared among all the family members who are a part of the policy. This means that in case one family member has to be hospitalised for some illness which is expensive to treat, the entire sum insured amount may get exhausted, leaving the other family members without health insurance coverage for the remaining portion of the year of that particular policy term.

Click here: Find out how you may opt for replenishment of your sum insured cover in your family floater health insurance policy

Limit on entry age:

Some health insurers have lower limits on the entry age into their policies. If you are looking to add your parents or parents–in–law in your family floater policy, a low entry age threshold may prove to be an obstacle.

Pro Tip: In case you are planning to add any senior citizen members of your family to your family health floater policy, do not discontinue their existing health insurance policies before your health insurance company approves of their addition.

Conclusion

You have seen how family health insurance plans offer you and your family huge advantages overall. However, they too come with certain key shortcomings and you should match your requirements with the available features and purchase add–on riders if so necessary to ensure proper coverage for health insurance.

References

https://economictimes.indiatimes.com/wealth/insure/health-insurance/3-changes-in-health-insurance-claim-rules-to-help-consumers-reduced-waiting-period-for-pre-existing-diseases-moratorium/articleshow/109315842.cms?from=mdr#:~:text=The%20IRDA%20has%20also%20reduced%20the%20specified%20waiting%20period.,an%20accident)%20are%20not%20covered.