Hyderabad: With medical inflation on the rise, the need for comprehensive health insurance has increased manifold. The multi-year health plans come handy to help policy holders stay protected without any hassles. You can pay premium for two to three years at one go and rest assured about uninterrupted health coverage.
Many take policies that are renewed every year. In recent times insurance companies are also offering multi-year, long term policies which ensure policy coverage for a long time by paying the premium at one time for two or three years. In an annual policy, the coverage will continue for a year. Reinsurance starts only on renewal. Instead, such hassles can be avoided with a multi-year policy.
Long-term policies require a larger lump sum payment when compared to annual policies. But, they come with some benefits. Special discounts are offered to policy holders for two or three years. Usually this discount is up to 5-10 percent. Depending on the insurer, it varies. It can be said that this is a financial benefit to the policyholder to some extent.
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Due to rising medical treatment costs, insurers are increasing health insurance policy premiums every year. In two or three year term policies, premium amount is paid in advance. Therefore, the policyholder is safeguarded from such inflationary premium increases. Critical situations such as unexpected loss of income, ill health etc may force some to stop premium payments. To avoid such eventuality, you can choose long term policies when you have money.
Moreover, premium paid for an annual health insurance policy is exempt under Section 80D of the Income Tax Act. Exemption is applicable on a pro rata basis. The insurance company will provide you with a Section 80D certificate for each year even in multi-year plans.
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Before taking a multi-year policy, one should think carefully about the choice of insurance company. The policy amount should be decided keeping the medical inflation in mind. Anticipate the extent to which medical treatment costs may increase in two or three years and see if the policy is adequate or not.
At the same time it cannot be transferred to another company till the end of the policy period. Therefore, all factors should be considered while choosing an insurance company. Check claim payment history and services offered to policyholders. These are important when taking an annual policy.
Insurance companies now allow payment of health insurance premium in installments. So, there is no need to worry about paying huge amount at once. Once a policy is taken, we have to renew it periodically till the end of life. Then only it will support us in times of any medical emergency. Once the premium is delayed or not paid, you will be denied its benefits.
