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Mediclaim - Saves life first, tax later

THE idea of making money can make a man move mountains. If you tell a man to stop smoking for the sake of his lungs, he'll cheekily blow a smoke ring in your face but offer him a rupee for every cigarette he gives up, you'll cure him for life! So, it's no wonder that when well-wishers ask you to take a medical insurance for health reasons you'll smile at them vacantly. But if tell you that it's going to safeguard his/her savings and also take home some extra money through tax exemptions, you'll jump at it.

Whatever your reason - health or wealth, you have no choice but to take it given the greater vulnerability to stress related illnesses and escalating medical costs. And if the fringe benefit tax is going to hit the medical cover from your employer, you definitely need to look at an individual cover.

Why do I need it?

Health care is a serious concern for most people today. Escalating costs accompanied by the scare of new viruses being detected every other day makes us want to run for cover. This is where mediclaim steps in. It is an insurance that takes care of your medical expenses or treatment expenses.

How much mediclaim do I need?

This depends on several factors such as age, health condition, lifestyle, etc. Ideally, you would want to cover costs of the big surgeries and operations. An angioplasty, for instance, can cost anywhere between Rs 50,000 to Rs 1.5 lakh (150,000) depending on the hospital you choose. A heart valve replacement can cost up to Rs 2 lakh (200,000). So, in order to decide the amount of cover, you would have to take a good look at your medical history and check how vulnerable you are to certain patterns of illnesses.

How much does it cost?

For a person up to the age of 35, the premium per annum for a cover of Rs 3 lakh (300,000) would be between Rs 3,200 to Rs 3,800. Now, that may not be such a substantial sum considering that you would get cover for treatment when you were to need it.

What are the benefits of mediclaim?

Medical insurance covers almost everything right from the time you step into the hospital till the time you are discharged. The normal costs that are covered are room and boarding expenses, nursing expenses, fees for the surgeon, anesthetist, medical practitioner and consultant, fees for specialists, charges for anesthesia, blood, oxygen and the operation theatre, charges for surgical appliances, medicines and diagnostic materials and charges for X-rays, dialysis, chemotherapy and so on. Even medicines are covered.

What are the limitations of mediclaim?

The most important exclusions till recently have been pre-existing health conditions. If a person has had a heart attack previously or has been operated upon for some other condition, then cover will not be available for those conditions. There are several other exclusions such as dental surgeries, cosmetic surgeries for aesthetic purpose, HIV related conditions, etc. Further, when you take the policy for the first time, any illness that commences during the first 30 days of inception of the policy is excluded.

What is cashless facility?

Cashless policies eliminate the entire trouble of documentation. In a cashless facility, the insurer will settle your bills directly with the hospital and you will be discharged without paying single paise. However, remember that the insurer will settle your bills only up till the sum assured of your policy. Any expense over and above that limit will have to be borne by you. This is unlike traditional policies wherein you would have to pay the hospital first and then claim reimbursement.

If you've read the above carefully, you'd have realised that health insurance is not for your health at all. It's to safeguard your savings. It's actually there to ensure that your hard earned cash does not flow into hospitals. Maybe if they called it 'wealth insurance' instead of 'health insurance' it would find more takers!

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