Why should one buy a separate Senior Citizen Policy?
Senior citizen parents need health insurance coverage because they face frequent medical ailments given their age. That is why it becomes important to get coverage for senior citizens under a health insurance plan. Under family floater health insurance plans, dependent senior citizen parents can be covered along with your family. However, this is not recommended. For covering your senior citizen parents, a separate senior citizen health insurance policy is more suitable.
A senior citizen health insurance plan is a health plan meant for covering older individuals aged 60 years and above. The plan has specific coverage benefits suitable for senior citizens which allow them an all-round coverage. Buying a separate senior citizen policy is better because of the following reasons :
- For custom-made coverage benefits
Senior citizen plans have specific coverage features which suit the requirements of senior citizens. Coverage for cataract treatments, joint replacement surgeries, knee replacement surgery, etc. can be found under senior citizen plans. Since senior citizens often require such treatments, the plan gives them a suitable cover.
- For low waiting periods
Under normal health insurance plans the waiting period ranges from 2 years to 4 years with 4 years being more common. Since senior citizens have one or the other type of ailment, such long waiting periods are not suitable and they result in out-of-pocket expenses. On the other hand, senior citizen plans have a low waiting period of 1 year to 3 years ensuring quicker coverage to senior citizens.
- For higher tax benefits
Section 80D of the Income Tax Act allows health insurance premiums to be allowed as a deduction from your taxable income. The limit of deduction is up to INR 25,000. But, if you buy a separate health insurance policy for your senior citizen parents, you can claim an additional deduction of up to INR 50,000. Thus, by insuring senior citizens under a separate plan, you can get higher tax saving.
Given these benefits, you should always try to buy a separate policy for senior citizens. There are distinct disadvantages of including senior citizens in your family floater plan. These disadvantages include the following –
- Your premiums are increased because under family floater plans the premium is calculated taking the age of the eldest member into consideration. If your senior citizen parents are included in the coverage, their age would be considered for premium calculation and the resulting premium would increase sharply
- Since senior citizens have a higher probability of claim, the incidence of claim under your family floater plan would increase. This would hamper the no-claim benefit which is available and you would lose out on your plan’s no claim bonus.
- A normal family floater plan might impose restrictions on the coverage if your senior citizen parents have some ailments. As a result even you, your spouse and dependent children would be able to avail only limited coverage under the plan.
Given the benefits of senior citizen plans and the obvious disadvantages of including senior citizens under a family floater plan, buying a separate plan is the best bet.