Rs 1 crore health insurance - Do you really need it?  | The Financial Express

Rs 1 crore health insurance – Do you really need it? 

As health insurance is a long-term product, one can consider taking a health cover of up to Rs 1 crore.

Rs 1 crore health insurance – Do you really need it? 
Is it necessary to take Rs 1 crore health insurance? An expert explains

With healthcare costs increasing by the day, health insurance has become a must for everyone. However, policy buyers often fail to decide the right amount of cover they should take for facing any health emergency. There are many policies now that offer health coverage of up to Rs 1 crore. But is it really needed? 

Experts say Rs 1 crore cover may not be necessary in all cases. But for families with a history of critical illness, such cover could be extremely helpful. 

“India has a double-digit medical inflation rate. As health insurance is a long-term product, one can consider taking a health cover of up to Rs 1 crore. This could be extremely useful if your family has a history of critical illness,” Dr. Sudha Reddy, Head, Health and Travel at Digit Insurance, told

“Treatments related to cancer or major organ transplants like kidney, liver or heart transplants can range anywhere between Rs 10-40 lakh in private hospitals, especially in metro cities. Keeping the rising medical costs in mind, one can opt for a health cover of up to Rs 1 crore. But do keep in mind that the premiums could be relatively higher; so, opt for a higher sum insured only if you can afford it,” she added. 

Also Read: 5% GST on hospital room rent: How will it impact health insurance policyholders?

In an e-mail interaction with, Dr Reddy shed more light on this issue of Rs 1 crore health cover. Edited Excerpts

Why lower sum insured may not be sufficient and what are the reasons to go for a higher health cover

A lower sum insured of Rs 5-10 lakh would typically suffice for an individual. However, the same may not be sufficient for an entire family. There could be instances of one family member getting hospitalised multiple times in the same year or other members also getting hospitalised during the same policy year (as seen during the Covid pandemic).

The treatment costs of critical illness are also very high, and a lower sum insured may not fully be sufficient in such scenarios. Some medical conditions also have recurring expenses due to long-term care or physiotherapy or follow-up consultations. A higher sum insured, hence, would also help in catering to such post-hospitalization expenses.

Considering the rising medical inflation, it makes sense to go for a higher sum insured for health insurance. 

As premiums are higher, one should also assess the affordability factor. A young couple with a kid can also consider starting with a cover of Rs 20-30 lakh after assessing individual requirements and revisit the need to increase the sum insured every three to five years.

What should one do if he can’t afford to have Rs 1 crore cover?

Buying a base cover of Rs 1 crore can be expensive. If the premium for a Rs 1 crore cover looks steep, one can consider a lower sum insured. 

A young family can start with a cover of Rs 30-40 lakh and increase the coverage in the coming years. A cumulative bonus under a health insurance plan will also bump up the sum insured for every non-claim year and one can slowly increase the overall insurance coverage every year.

If I take a Rs 1 crore health plan, will it cover my family too?

One can opt for a family floater plan, wherein you can cover yourself as well as your entire family under one insurance plan. However, if you also want to cover your parents, one can consider a separate plan for them as the family floater plan premium would otherwise go up significantly. This is because the insurance premium is subject to the age of the eldest member of your family (which in this case will be the age of your parents).

Also Read: How much sum assured you need to face any emergency?

Does higher amount of cover lead to better coverage terms?

The coverage terms under a particular health insurance plan, typically, remain the same despite the sum insured opted for. A higher sum insured may not necessarily mean complete protection against any type of hospitalization. One should carefully go through the policy terms and understand different waiting periods, different disease level or room rent level capping, exclusions, deductible and co-pay terms, etc before opting for a health insurance cover.

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