Taking care of your health is a significant goal in everyone’s life. But presently, cruising costs in every segment of life, including health costs are negatively impacting the finances of individuals. In such situations, health insurance acts as a key part of one’s financial planning.
Health insurance policy can significantly impact your financial planning by providing a safety net during medical emergencies. From covering hospitalization costs to offering tax benefits, a well-chosen health insurance plan ensures you can manage healthcare expenses effectively.
This blog will show you how getting insurance influences your financial planning and allows you to maintain financial stability.
How Does Health Insurance Support Financial Planning?
Health insurance policy helps you in various ways that directly impact your financial planning in a good way. Here are some instances:
1. Medical Crises
Usually, a crisis catches people off-guard and gives no time for preparation. Medical emergencies are such crises that do not always come with an announcement and can happen at any time.
People choose health insurance based on their age, lifestyle, medical history, profession, and many other factors. A suitable plan lets you tackle such medical emergencies with financial backing. This removes the worry about the healthcare costs that may result from the hospitalization and lets you focus on recovery.
2. Healthcare
Consistently staying in the best health is necessary to sustain a happy and prosperous life. Visiting general physicians on a routine basis for check-ups and getting necessary recommendations is a part of the process of staying healthy. Health insurance plans encourage this practice and also reimburse you for it.
Apart from the hospitalisation expenses your health insurance policy will also reimburse for pre-hospitalization expenses for up to 60 days and post-hospitalization for up to 120 days. Before purchasing a policy you should check if it offers you such benefits and what check-ups are allowed for reimbursement.
3. Rising Medical Costs
Medical inflation is a phenomenon that no one can avoid and the probability of contracting a lifestyle disease is very high in the current populace. The probability of a serious illness in the future along with medical inflation presents a situation potent with heavy financial burden.
A suitable health plan is one of the best solutions for such challenges. By protecting you from medical inflation it can help with your financial planning significantly.
4. Tax Benefits
This aspect of the health insurance plans will have a considerable impact on your financial planning. You will get these benefits under Section 80D of the Income Tax Act which states that if you pay health insurance premiums for yourself, your parents, spouse, or dependent children you will get tax deductions up to Rs. 25,000 and Rs. 50,000 (for senior citizens).
5. Retirement
If you work a corporate job you will not receive a fixed income when you retire. During this period a health insurance plan will act like a guardian angel if you require financial support for an ongoing treatment, get ill, or any medical emergency occurs. As it takes care of the financial side of healthcare you can spend your retirement days comfortably.
How to Reduce Financial Burden with Health Insurance Plans?
The importance of health insurance in financial planning is even more evident when you learn there are several ways to reduce healthcare costs with a health plan:
1. Buy a Plan Early in Life
There is a common misconception that you do not need a health insurance policy if you are young and healthy. However, the pandemic has busted this myth for the public. Moreover, opting for a health plan when you are young and healthy leads to lower premiums that are financially beneficial in the long run.
2. Get Cashless Treatments
If your preferred hospitals are within your insurer’s network hospitals, then you get the opportunity to opt for cashless treatment whenever you need it.
3. Cover All Your Family Members
Anyone in your family may need emergency medical attention, so protecting your family with family floater health plans is a wise idea, financially too. Moreover, getting a separate plan for senior citizens may also be a good idea as their needs are different from those of adults.
4. Critical Illness Health Plans May be Necessary
Consult with an expert and decide if you or your family needs protection for treatments concerning critical ailments like heart disease, diabetes, cancer, and so on. These plans will offer a lump sum amount if the insured person is diagnosed with any critical illness included in the plan.
5. Opt for Top-up/ Super Top-up Plans
If you cannot afford a sufficient sum insured, you can opt for top-up or super top-up plans that will help extend the coverage of the base plan significantly without putting much financial strain.
The Bottom Line
It is wise to incorporate a health insurance policy into your financial planning. By selecting the right policy, you can safeguard yourself against rising medical costs, enjoy tax benefits, and ensure financial security during retirement. Moreover, the benefits discussed above will help you reduce the financial burden healthcare costs may put on you and being aware of the coverage lets you make better financial decisions.
