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Complete your cover story with a health insurance policy

After all, you can enjoy life and live to the fullest only when you are healthy and you have the peace of mind this security brings.

Updated: Mar 16, 2012, 03.46 AM IST
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By: Damien Marmion, CEO, Max Bupa

The change of season among other things is host to several end of season sales and it is common to come across compulsive shoppers at such sales busy looking for the best bargain. Many swear by the deals they have spun, but I have always viewed these with great trepidation.

My worry stems from experience when, because of the hurry, one tends to either buy something that they don't necessarily need or something that doesn't totally match their requirements. Yet, come the last quarter of the financial year, and there is a rush to buy financial products to save taxes; many a times at the expense of not rightly evaluating the need for the right product.

There is a lot that taxpayers can gain from aligning their tax planning to their financial plans. Done smartly, it is a win-win situation wherein you not only save taxes, but also achieve your financial goals with ease. A successful financial plan rests on adequate and appropriate insurance covers. While life insurance is addressed by most people even at the expense of being under-insured, health insurance is mostly given a miss.

I have come across several potential customers who question the need for health insurance with the belief that their good health is eternal. They reason that given their good health, the premium outgo on a health policy is a wasteful expense. After all, unlike a life insurance plan that accrues survival benefits; a health plan offers no such tangible advantage if the policyholder does not raise a claim.

Now imagine a situation when a health condition not only depletes your finances when getting treated, it also diminishes your ability to earn. This could potentially drain your savings and lead to a huge financial burden on the family, and it is at times like these that one feels the need to be able to use their life insurance in some way.

Therefore, a resource pool to dip into for one's health care needs is an absolute must. In the absence of a strong state-sponsored quality healthcare system in India, healthcare is self-funded, which is one of the reasons why the government provides tax concessions when people buy health insurance.

A little sum provides a peace of mind that one's hard savings and investments are not disturbed to meet healthcare costs. We live in times where healthcare risks are higher due to changing lifestyles and healthcare costs are only rising with the demand for critical care going up. The 15,000 deduction on premiums paid under Section 80D that non-senior citizens can claim or 20,000 that senior citizens can claim are valuable.

However, purchasing health insurance should be driven by the need for it and not to blindly chase tax benefits. There are plans available to suit individual and family health care needs, the premiums for such plans vary. There are policies that also have preventive care considered in the pricing and offer preventive health care through initiatives such as proactive health information, free health check-up opportunities, and dedicated health line.

So, it is important that we assess our families' health care need and accordingly look for the coverage provided under than the health insurance policy, rather than be dictated by the premium match tax deduction levels.

Considering the current proposals when the direct tax code comes into effect, health insurance premiums will vie for the same importance as would life insurance premiums and not carry the special treatment that it carries currently. Such a situation should not influence you to value your health insurance lesser than life insurance. After all, you can enjoy life and live to the fullest only when you are healthy and you have the peace of mind this security brings.
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