Health insurance is a cornerstone of financial planning. It is a necessary financial protection for every individual and family as it covers unexpected medical expenses that could otherwise strain their finances. While making this crucial decision, you must rationally consider needs and other factors to avail the right health insurance coverage. Individual health insurance and family floater plans are the two main options available. Choosing between them requires a clear understanding of your requirements, including age, family size, health conditions, and budget. This article helps you make a suitable choice after understanding the difference between both options.
What is Individual Health Insurance?
As the name implies individual health insurance policy is a standalone policy that provides coverage specifically for a single person. If insured, each family member will have their own sum insured. For instance, if you purchase a plan with a sum insured of INR 3 lakhs, it exclusively covers your medical expenses and no other family members’ expenses.
The following are the key features of individual health insurance plans:
- Exclusive Coverage: The insured person gets the full sum assured for his/her medical needs.
- Customisable Coverage: The coverage can be tailored based individual’s health condition and insurance needs.
- Relatively Higher Premium: When individual covers are availed for all the family members, the cumulative premium for the coverage is relatively higher, making it expensive for families.
- Suitable for High-Risk Individuals: It is best suited for high-risk individuals with chronic and pre-existing conditions requiring frequent and extensive medical care.
What is a Family Floater Health Insurance Plan?
A family floater policy provides umbrella coverage to an entire family with a single sum insured. For example, you have purchased a family health insurance with a sum insured of INR 15 lakh. This limit can be utilised by any or all family members when a medical emergency arises during the policy term.
The following are the key features of family floater health insurance:
- Combined Coverage: The sum insured is shared among all members covered under the plan.
- Cost-Effective: Premiums are relatively lower in comparison to the cumulative premium of individual policies purchased for each family member. However, premium costs are influenced by the age of the oldest family member in a family floater plan.
- Dynamic Needs: Younger families with typically good health and lower risk profiles benefit the most from this plan.
Individual Health Insurance Vs. Family Floater Plans
Here are some of the key differences between individual health insurance and family floater plans:
| Feature | Individual Plan | Family Floater Plan |
| Coverage | Comprehensive and exclusive coverage for one person. | Comprehensive and combined coverage for all family members under a single sum insured. |
| Eligibility | The entry age may vary depending on the type of plan. Plans are available for children to senior citizens. Each individual gets a separate coverage and policy. | Under the family floater plan, primary applicants can add a spouse, dependent children, and parents. Children and senior citizens are covered. However, the policy can be renewed only until the oldest member of the family attains the maximum age of renewability. |
| Premium Cost | Relatively higher for multiple family members (combined) | Cost-effective to cover all members of the family. |
| Customisation | Coverage can be tailored to an individual’s medical needs | Less customisable based on individual needs. |
| Risk factor | Claims of family members do not have any impact on each other. | Claims from one member of the family reduce the health coverage for other members. |
| Suitability | Suitable for high-risk individuals | Suitable for families with lower health risks. |
Which is Best for You?
Choosing between individual and family floater health insurance can depend on various factors:
Family Size and Age Composition
Individual plans are a good option for people or families looking out for exclusive coverage, and seeking extensive and prolonged medical care due to chronic and pre-existing health problems. Affordable family health insurance is a cost-effective and great option for young families with minimal health risks.
Affordability
Individual plans, while more expensive for multiple members, ensure that each person’s sum insured remains unaffected by the claims of others. Family floater plans are typically more economical and suited for those looking to cover multiple members under one policy.
Future Insurance Needs
If you anticipate frequent or high medical expenses for any family member, it is good to consider individual policies to avoid exhausting the shared coverage of a family floater. A family floater can be a practical option for young couples or nuclear families.
Before making a decision, it is important to understand the health insurance plan, and its suitability and compare the options. SecureNow offers different types of health insurance plans from various insurers online, making it easy for you to make a rational choice.
Conclusion
To sum up, choosing the right health insurance plan requires a clear understanding of your family’s medical needs, financial capacity, and future requirements. Individual plans provide dedicated and highly customisable coverage for each insured person, making them ideal for high-risk. On the other hand, family floater policies are cost-effective and convenient for younger families with lower health risks.
Frequently Asked Questions (FAQs)
Can both individual and family floater policies be purchased simultaneously?
Yes, you can have a combination of both plans to ensure comprehensive coverage. For instance, younger family members can be covered under a family floater plan, while aged parents can be covered under an individual plan.
Can I enhance the sum insured during the policy term?
Yes. The sum insured can be enhanced for both individual health insurance and family floater health insurance plans during the policy term after the review of insurance coverage needs.
Can I switch from an individual plan to a family floater plan later?
Yes, many insurers allow you to switch between plans during policy renewal. You can also port your policy to a different insurance provider, subject to underwriting and approval.
