Why Critical Health Insurance Is Gaining Popularity?

The rising cost of healthcare in India and the increasing prevalence of life-threatening illnesses have made financial preparedness a necessity. Critical health insurance is gaining popularity as an essential financial safeguard against major illnesses such as cancer, heart disease, and kidney failure. This type of insurance provides a lump sum payment upon diagnosis of a covered critical illness, ensuring policyholders have the resources to manage medical and lifestyle expenses. In this article, we explore why critical health insurance is becoming a preferred choice for Indian families, its benefits, and how tools like the BMI calculator can help assess individual health risks.

What is critical health insurance?

Critical health insurance is a specialised health insurance plan designed to provide financial assistance when a policyholder is diagnosed with a critical illness. Unlike traditional health insurance that reimburses hospitalisation expenses, critical health insurance offers a lump sum payout that can be used for various purposes, including treatment, rehabilitation, and daily living costs.

Key features of critical health insurance:

1. Lump sum payout: The insured receives a pre-determined sum upon diagnosis of a covered illness.

2. Comprehensive coverage: Includes illnesses such as cancer, heart attack, stroke, kidney failure, and organ transplants.

3. No restrictions on usage: The payout can be used for non-medical expenses like paying off loans or supporting lost income.

Why critical health insurance is gaining popularity?

The growing awareness of health risks and the financial impact of critical illnesses are driving the demand for critical health insurance. Here are the main reasons behind its rising popularity:

Increasing incidence of critical illnesses

Modern lifestyles, stress, and unhealthy eating habits have contributed to a surge in lifestyle diseases and critical illnesses in India. Conditions such as diabetes, hypertension, and obesity increase the risk of severe illnesses like heart disease and kidney failure. Tools like the BMI calculator are helpful in identifying early signs of health risks, encouraging individuals to take preventive measures and consider insurance coverage.

• Statistics: According to a report by the Indian Council of Medical Research (ICMR), cancer cases in India are projected to rise significantly, highlighting the need for financial preparedness.

Rising medical costs

Healthcare inflation in India is driving up the cost of treatments, especially for critical illnesses that require advanced procedures and prolonged care. Critical health insurance provides a financial cushion, helping individuals afford expensive treatments without depleting their savings.

• Example: A single cancer treatment can cost several lakhs, which might be unaffordable for many families without insurance.

Financial independence during recovery

Critical illnesses often lead to prolonged recovery periods, affecting the earning capacity of the patient or their family members. The lump sum payout from critical health insurance ensures financial independence, covering daily expenses, loan repayments, and lifestyle adjustments.

• Benefit: This financial support allows patients to focus on recovery without the added stress of managing household finances.

Awareness of holistic financial planning

As more Indians embrace the concept of financial planning, critical health insurance is being recognised as an integral part of a comprehensive financial portfolio. It complements traditional health insurance by addressing specific financial risks associated with major illnesses.

• Insight: Financial advisors recommend critical health insurance to safeguard against unforeseen medical crises, which can otherwise derail long-term financial goals.

Employer-provided insurance limitations

Group health insurance policies provided by employers often have limited coverage and may not include critical illnesses. As a result, individuals are opting for standalone critical health insurance to ensure adequate protection.

• Reality check: Employer policies may not continue after retirement or job changes, making personal critical health insurance a necessary backup.

Benefits of critical health insurance

Immediate financial support

The lump sum payout provides instant financial relief, which is especially crucial for time-sensitive treatments like surgeries or chemotherapy.

Customisable plans

Insurers offer critical health insurance plans with customisable coverage options, allowing policyholders to choose based on their health risks and budget.

Comprehensive coverage

Many policies cover a wide range of critical illnesses, ensuring financial security for various medical conditions.

Tax benefits

Premiums paid for critical health insurance are eligible for tax deductions under Section 80D of the Income Tax Act, providing an additional financial advantage.

Peace of mind

Knowing that financial protection is in place for unforeseen medical emergencies offers peace of mind, reducing stress for both patients and their families.

How BMI calculator aids in health risk assessment

The Body Mass Index (BMI) calculator is a simple tool to assess whether an individual’s weight is appropriate for their height. A high or low BMI can indicate potential health risks, making it a valuable resource for understanding personal health.

Benefits of using a BMI calculator:

1. Early detection of health risks: Identifies risks related to obesity, which is a major factor in critical illnesses like diabetes and heart disease.

2. Personalised health planning: Helps individuals take proactive measures to maintain a healthy weight and reduce the risk of lifestyle diseases.

3. Informed decisions: Encourages individuals to consider critical health insurance if they are at higher risk of developing chronic conditions.

Factors to consider when choosing critical health insurance

Coverage and inclusions

Ensure the policy covers a wide range of critical illnesses and provides adequate financial support for your specific health risks.

Waiting period

Most critical health insurance plans have a waiting period before coverage begins. Choose a policy with a shorter waiting period to ensure timely financial assistance.

Premiums and affordability

Compare premiums across insurers to find a plan that offers comprehensive coverage at a reasonable cost. Keep in mind that premiums may vary based on age, health condition, and sum insured.

Claim settlement ratio

Opt for insurers with a high claim settlement ratio to ensure hassle-free processing of claims during emergencies.

Additional benefits

Some policies include value-added features like free health check-ups, wellness programmes, or discounts on premiums for maintaining a healthy lifestyle.

Conclusion

Critical health insurance is gaining popularity as an essential safety net against life-threatening illnesses. With rising healthcare costs and the increasing prevalence of critical illnesses, this type of insurance offers much-needed financial security. By providing a lump sum payout, it empowers policyholders to manage medical and lifestyle expenses without financial strain. Tools like the BMI calculator can help individuals assess their health risks and take proactive steps towards better health and financial planning. Investing in critical health insurance is not just a wise financial decision—it’s a step towards ensuring a secure and stress-free future for you and your loved ones.