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Incorporating Health Insurance in Financial Planning

Though the awareness of having a health insurance plan has increased, some of us still do not understand its importance.

  • 12 Sep 2017
  • min read

Though the awareness of having a health insurance plan has increased, some of us still do not understand its importance. The need to assess and hedge your health risk arises from the fact that the health care costs have been rising at more than 20% on an annualised basis. Many of these are not even covered by the medical cover that you avail. If you know the importance of health insurance, kudos to you! But if you don’t, read on.

Out-of-Pocket Expenses

Since medical inflation is always on the rise, it is essential to build a corpus which will exclusively cater to your out-of-pocket expenses for medical reasons. The amount you do not spend can be kept aside to build a decent amount of money that can be utilised in times of need. But, there is a right way to go through with that plan and that is through health insurance.

There is no point in depleting your hard-earned money that you have saved up for health contingencies. A health insurance plan is designed to take care of these increasing medical expenses. By paying for such expenses, the plan protects your savings from being drained out in case of a medical emergency.

Tax Exemption from the Government

Isn’t it great when you don’t have to pay taxes on the amount of money you save? Health insurance helps you in this regard too. Your health insurance plan will cover you and your family without you having to pay any taxes to the government. The premium you pay for your plan is exempted from tax under Section 80D. You can, thus, claim up to Rs.60,000 as tax exemption if you pay health insurance premiums for yourself and your dependent parents (if both are senior citizens).

Lifetime Renewability Feature

Health insurance is no longer exhaustible! Did you know that health plans come with a lifelong renewability feature? You can renew health plans for you and your family for as long as you live, without any maximum renewal age! It proves beneficial when you retire and have to cut back on your out-of-pocket expenses. With old age come low income and high medical contingencies. If you have a health plan, any medical contingency you face would be covered by your health plan thereby sparing your savings.

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Pass On the Knowledge

Imparting the knowledge of the benefits of having a health insurance plan in your children is very important. It will help your children to include a health insurance plan in their financial planning. They will only learn it, if you, yourself will you inculcate the habit of making a health insurance investment. So, learn the importance of health insurance yourself and then impart this knowledge to your children.

Health Insurance Is A Must!

If the rising healthcare costs are any indication, you should invest in a health insurance plan at the earliest. Furthermore, health insurance investment is not a one-time deal. You also must pay attention to its timely renewals to continue its benefits. Having a valid cover throughout your life helps after retirement too, when your plan pays for all your medical expenses.

Related Article:

Why Health Insurance Claims Get Rejected?
Why a Top-Up Mediclaim Must Cover All Costs Above Base Policy

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