You can make health insurance your companion in your quest for financial independence. The health insurance plans in India protect your finances and ensure that you do not have to take any detours in your life. Learn how health insurance plans in India can keep your financial planning journey intact in this piece.
Planning and strategizing are very important to get what one wants in life. And financial planning is an activity that ensures you reach your life’s goals effectively. You can chalk out your financial goals and achieve them with the help of financial planning. Nevertheless, while creating a financial plan effectively, you are required to factor in medical emergencies as well as they can derail even a well-defined and well-thought financial strategy.
CII organized the Asia Health 2020 conference in which as per a data about 50-60 million Indians are pushed into poverty every year because of their inability to pay out-of-pocket healthcare expenses. India has one of the highest healthcare out-of-pocket expenditure wherein 70% of the expenses are borne by the customers. Out of these expenses, around 95% are funded with pocket and 5% by health insurance. This particular data means an additional 7% of the population being annually pushed into poverty.
Out-of-pocket healthcare expenses eat into your savings and derail your financial planning. If you want to avoid such expenses, investing in health insurance is the only solution. While you cannot change the healthcare out-of-pocket expenditure in India, you can definitely increase its insurance portion.
Health insurance plans have become a necessity today. The medical expenses are surging continuously and at the same time diseases are also on the rise. The world today is grappling with the Coronavirus pandemic. No one knows when the pandemic will end and who knows what disease would befall in the coming years. The option we have is of opting for a good health insurance cover. Under a health insurance plan, you get coverage against hereditary diseases, lifestyle illnesses, and also accidental injuries.
Common ways in which health insurance keeps your financial planning intact
1. Health insurance policies allow coverage for the entire family
Health insurance plans are available as individual plans, family floater plans, as well as critical illness policies. Again, if your parents are old, you can invest in a senior citizen health insurance plan to cover their medical needs. Now when all the members of your family will be insured under health insurance policies, no one’s medical needs could impact your financial planning. And thus, you would be able to meet all the medical expenses in rainy days, without breaking a sweat.
2. A health insurance plan can prevent a financial crisis
On checking the coverage benefits of different health insurance plans, you would know that most of the plans cover almost all the types of medical expenses that you could incur when there is hospitalization due to a medical contingency. And when all your medical costs are covered, your finances stay safe. Thus, health insurance helps you prevent a financial crisis. Hence, you can go about planning your financial goals without thinking about a medical crisis wiping out your savings.
3. A health insurance plan helps you become mentally ready for any rainy days
Emergencies can strike at any time. And, if you plan right, you can meet the demands of any emergency. Most emergencies need you to be financially ready and that is why one of the pillars of financial planning is emergency planning. Health insurance plans ensure that when any untoward medical emergency occurs, you are prepared to face them. A critical illness policy covers major dreaded illnesses and procedures.
4. You even get tax benefit by buying health insurance
With the tax benefits offered in India, you can increase the mileage of your financial plan. Health insurance plans help with saving taxes. The premium paid towards insurance earns you a tax deduction under Section 80D. You can claim deductions up to Rs 1 Lakh and save up to Rs 45,000 in taxes when you are in the 30% bracket. You can invest such saving towards various avenues to supplement your investments. You can get tax benefits even with critical illness policies.
In your financial independence journey, it is highly important to make health insurance your companion. Protect your finances and make sure your journey does not get side-tracked by having right health insurance plans for all your family members.