Health insurance plays an integral part in achieving your financial goals. Apart from covering your life against any unfortunate event, it also provides the peace of mind that your loved ones will not have to suffer financially after an unfortunate event. Making a mistake while investing can be rectified, but you only buy health insurance once. If your health insurance plan goes wrong, your whole financial future will be severely jeopardized.
The 10 most typical mistakes people make when buying health insurance plans
Here are the most common 10 mistakes people make when they buy health insurance plans, and what you can do to avoid committing them:
- Inadequate cover: People tend to buy a health insurance plan which they think will be light on their pocket. What they fail to understand is the insufficient and low amount these health insurance policies provide in the event of a health mishap. In the case of an actual emergency, this low coverage amount proves to be inadequate for covering the medical and hospital bills, thus creating a financial burden on the family. It is therefore advisable that you buy an online health insurance policy that comprehensively covers all of your future healthcare needs.
- Health insurance for tax benefits: Buying a health insurance plan only for the motive of saving tax always leads to an idea; having an inadequate insurance cover. The premium you pay towards your health insurance is indeed tax-deductible under section 80D, but the sole purpose of a medical insurance plan should be to cover your expenses in case of an emergency and not tax benefits. The health insurance benefits are unique and help you in several other ways.
- Lying about the medical background: For fear of the insurance company rejecting their insurance application, people tend to lie about their medical history by concealing relevant information. Hiding information about existing medical conditions could lead to rejection of your claim when the insurance company does its due diligence and background checks. You should reveal all the information about your health history while buying a health plan.
- Too much cover: Before buying an insurance policy you should reconsider the cover you are getting in the insurance plan Taking too much health insurance will lead to pricey premiums and lapse of the policy if you are unable to pay them.
- Not comparing the best plans: How would you know what is best for you without looking at different alternatives? Everyone has different needs and financial backgrounds. Buying a health insurance policy only because it is the same scheme your friend or your relative has bought would be a grave mistake. You should always purchase health insurance after assessing your future needs and comparing different policies with each other to know what plan would be a perfect fit for you.
- Not adding “Riders”: To some extent, it could be true that you are healthy and don’t need to visit a doctor regularly. However, what can be said about accidents and illnesses? Riders provide you with extra insurance amount if you suffer from an accident or illness mentioned regarding the rider. You should always consider adding a rider to your health insurance plan, as you can never anticipate accidents and critical illnesses. This would provide you with an extra amount apart from your insurance cover to pay the expensive medical bills of the hospital.
- Young people do not need insurance: While it may be true that young people are healthier, it is also true that buying online health insurance should be the primary priority of everyone, irrespective of the age. As life is full of uncertain events, they do not choose between young and old. You should consider buying a health insurance plan even if you are in your 20s or 30s. Buying a health insurance policy online costs less, particularly for younger age groups.
- Not reading the policy terms: People make a big mistake when they skip on reading the terms and conditions of the policy and find out something years later that negatively affects their whole financial plan. You must read the fine print of the policy in detail to get a general idea of what you are buying and how it will affect you in the future.
- Buying an additional policy: People buy an additional health insurance policy to extend their coverage further. In the long run, it is not cost-efficient and leads to small savings. If you want to extend your protection, you should avail of the option of “Top-up,” which will allow you to prolong the coverage of your existing policy.
- Not knowing about discounts: During the term of the health insurance coverage, you may be entitled to specific discounts from the life insurance company.