Top 5 reasons to invest in an individual health insurance plan

A recent report on the healthcare industry revealed that healthcare inflation in India grew at the rate of 14% in 2021. (Source: Motilal Oswal) Especially since the COVID-19 pandemic, more and more people have realised the importance of having individual health insurance in the face of a medical contingency. The pandemic was a harsh lesson on how not having health insurance could mean huge losses in more ways than one. And, to those who relied only on a family floater plan, it highlighted the biggest limitation of such a health insurance plan—inadequate coverage if more than one family member needs immediate medical attention.

If you are still not convinced about having individual health insurance coverage, then this article is for you. But, before we get there, let us look at what are individual health insurance plans and how they are different from family floater plans.

What are individual health insurance plans?

In India, there are two types of health insurance plans—family floater plans and individual plans. A family floater plan safeguards the health of the whole family, including spouse, children and even parents under the same plan. A single sum insured is shared by all family members. 

Meanwhile, an individual health insurance plan covers only one person or individual. Under this plan, the insurer will pay the policyholder’s medical expenses up to a fixed sum insured. The premium for an individual health plan is determined by the policyholder’s age, current health status, medical history, and geographical location.

Some standard inclusions and exclusions of an individual health insurance plan are:


  • Pre and post-hospitalisation expenses
  • Domiciliary treatment costs
  • Day care procedure
  • Hospitalisation costs
  • Ambulance service costs


  • Expenses related to cosmetic surgeries 
  • Dental, vision and hearing-related expenses
  • Pregnancy and related medical conditions
  • Pre-existing conditions (till the waiting period is active)


5 reasons why you should opt for an individual health insurance plan 

Now that you know what are individual health insurance plans, let us look at some of the top reasons why having an individual health plan can prove beneficial in a time of need.

1.A fitting healthcare solution for young individuals

Individual health plans are perfect for young and unmarried people. Since the individual plans offer medical coverage for only a single person who’s buying the plan, young and single people benefit from it the most as their healthcare needs are limited and restricted to only them.

Individual health insurance plans, as opposed to mediclaim plans, provide numerous policy benefits such as lifelong renewability and flexibility of customisation. They offer comprehensive coverage for complete medical expenses. Nowadays, besides securing you against an unforeseen medical contingency, they also include coronavirus treatment.

Today, many young people are struggling with lifestyle-influenced ailments. Under an individual health insurance plan, you are covered for pre-existing conditions and specific illnesses after the stated waiting period is over. It is essential to take your time and carefully read the policy documents. 

  1. Spiking healthcare costs

Although there have been significant advancements in medical science, the price of treatments and healthcare services is only soaring high. Accidents, injuries and other medical emergencies strike when you least expect them. In such circumstances, coping with sudden spikes in medical bills can become a substantial financial challenge. 

This is where an individual health plan can help you. It provides you with the necessary financial assistance you require to deal with such inevitable medical expenses. In addition, it allows you to avail of the cashless treatment facility at a network hospital of your choice. It not only saves your time but also takes the burden of having to arrange funds at short notice off your shoulders.

3.Safeguards you after retirement

Your post-retirement years will be much less stressful if you invest in an individual health plan early on. It will help you deal with age-associated illnesses and expensive medical treatments. As you age, acquiring health insurance becomes challenging and more expensive. Whereas when young, it is easier to get health insurance without any pre-policy medical examinations. 

With the amazing renewability feature, you will continue to receive coverage under the same health insurance policy. Additionally, the accumulated benefit from the No Claim Bonus will come in handy.

4.Enables tax savings

Saving tax is one of the key objectives of any working professional, be it young or old. For those looking for methods to save money, individual health insurance is an appealing choice. It provides the extra benefit of protecting one’s health while also saving taxes. As per Section 80D of the Income Tax Act, you can avail of a deduction of up to Rs 25,000 on your health insurance premium payments (Source: Indian Kanoon).

The maximum limit of annual deduction for a single person is up to Rs 25,000. In the case of senior citizens, the highest deduction amount allowed is up to Rs 50,000. If both the plan’s proposer and insured party are senior citizens, the total deduction cap is up to Rs 1 lakh.

5.Safeguards your savings 

Healthcare costs are only going up and without a robust individual health insurance plan, you’ll be liable to pay for high medical costs associated with your medical care. You never know when you might need huge amount of money due to a medical emergency. In such a situation, you will have no option but to either dig into your savings or take on debt. Thus, having an individual health plan can help you keep your hard-earned savings intact.


A health insurance plan assures protection during your tough times. In the wake of a medical contingency, you should be focusing on treatment and improving your health, and not on ways to raise funds to meet medical expenses. Health insurance offers an extra layer of security to your finances and guarantees you access to high-quality medical care whenever you need it.

Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales.

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