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Posts Tagged ‘Health Insurance’

Just the thought of retirement can cause anxiety and many feel overwhelmed and unprepared. People who have planned their retirement early and saved enough regularly throughout their earning years are comfortable and plan their retirement better. However, in case you have not done so,  here’s how you can plan your retirement when you are in the last decade before your retirement age.

  1. How much money would you need?

The first question one must ask is ‘how much income would I need to maintain my current lifestyle in retirement?’

If the assumption is too high, the goal of retirement may seem absolutely unattainable, and the entire planning process is discouraging.  If the assumption is too low, which is most often the case, the retiree could run into a difficult financial situation later in life and have to make drastic, unwanted changes.

Keep in mind that retirees spend more on travel, entertainment and eating out especially earlier on in retirement, when they have the time and good health to enjoy those activities.

  1. Consider Health care cost:

One of the most overlooked areas of retirement planning is estimating what health care costs could be in retirement, and including this in the calculation of income needs.

Please remember that these could be a combination of recurring and one time costs, and medical inflation tends to be much higher than regular inflation. By overlooking this large potential outlay, retirees could feel strapped for cash in their most vulnerable years.

  1. Choosing the right investment product

It is important to save for retirement, but it is equally important to choose the right investment product. Since the tenure to retirement is in the range of 5 to 10 years, one should look at the mix of growth assets which give inflation beating returns and fixed income instruments which provide stability in returns and liquidity.

 

  1. Estate Planning:

Many people think they don’t need to do any sort of estate planning. Estate planning in necessary to eliminate uncertainties over the administration and inheritance of all your assets and to maximize the value of the estate by reducing taxes and other expenses.  Writing a Will and creating a trust if necessary are some form of Estate Planning.

 

Remember that this phase could coincide with some big expenses for your children, but don’t compromise your retirement in the process. Remember there are no retirement loans, so avoid emotional decisions that could create a challenge in your retirement.

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With rising medical costs it is a must to buy a health insurance. A health insurance policy is a policy which covers your medical and hospitalization expenses.

There are two types of health insurance – An individual cover and a floater cover. A floater is a cover for more than one individual or the entire family with different options like two adults and two children in one policy or one adult and one child under one policy etc.

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Does your policy have the following features?

All these features vary from company to company.

Pre-existing exclusion:  A pre-existing disease is the one for which the patient has already received a medical advice or treatment prior to enrollment into a new health policy for example diabetes, blood pressure, etc. A pre-existing exclusion means the number of years for which your pre-existing diseases will not be covered. It mostly ranges between 2 to 4 years.

The lesser the waiting period the better is your policy.

Co pay: At the time of claim there may be a proportion which has to be partially borne by the insured. It is preferable to have no co pay at all. In the event of a higher claim the amount which will be needed to be borne by the insured can be huge. For example if you have a 80: 20 system then insurance company will pay 80% of the claim cost and 20% will have to borne by the insured in spite of having a cover which is good enough to cover the entire expense.

If your policy has no co pay then it is much better.

Sub limits: Insurers insert a cap on room expenses, doctor fees, etc. This means the company will pay only to the extent of the cap and beyond that the insured will have to bear the cost.

If your policy has no sub limits then it is much better

Exclusions: Exclusions is a list of diseases which will not be covered under the plan. It is very important to pay attention to this. To decide on this parameter you can compare few policies and choose on the one with limited exclusions. For example the most common exclusions are cosmetic surgery, weight loss program, adult dental care, etc.

Disease waiting period: Some diseases have a waiting period after which they get covered under the policy. For example some companies have waiting period for cataract, hernia, etc for two or more years. The lesser it is the better it is.

If your policy has no waiting period or a minimum waiting period then it is better.

Disease wise capping: For some diseases there is a cap for example a cap of Rs. 1 lakh on a particular disease. Thus even if you have a sum assured of Rs. 2 lakhs the company will reimburse only Rs. 1 lakh.

If your policy does not have disease wise caps it is better.

No claim bonus: For every claim free year you receive a percentage increase in your sum assured. This depends from company to company, and is likely to be capped at a maximum level.

If your policy gives a good no claim bonus that would give you the benefit of an effective higher sum insured till you make a claim.

All the above features need to be looked at in total and not in isolation.

Premium

The premium increases with age. Mostly insurance companies have age bands for premiums. The premium gets decided based on the age of the eldest family member in case you choose to use a family floater. Therefore if you have a separate individual cover for an older person, it may help with lower premiums. Similarly is someone has diabetes or any other existing disease which will lead to higher premiums due to loading, then again it may be better to buy an individual cover for that person.

A lower premium always does not mean that you have chosen a good policy. Do look at the cost aspect but do not ignore features.

Last but not the least,

Do go through the policy wordings to get to the fine print because going through the policy brochure may not be enough. Remember, health insurance products keep getting better, so see if you have the most appropriate solution every few years.

Image credit: support.bajajallianz.co

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Many students opt to study abroad in the University of their choice. Students secure admissions after a lot of hard work and parents invest their hard earned money to provide their children with the best education. How prepared are you to send your child abroad for his higher education? You might be financially ready to send him but there are few more things to consider. Adequate health insurance is a must.

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Image Source: www.studyabroadinsurance.com

Why there is a need for health insurance for students travelling overseas?

Student medical insurance safeguards students against unforeseen expenditures that may arise due to medical mishaps during their studies abroad. Medical issues could arise due to change in environment, lifestyle, mental stress, etc. The cost of medical treatment abroad is much higher than in India. These policies not only cover medical costs but also some of the non-medical emergencies related to in transit risk while travelling overseas. Universities also offer health cover to students. University provided insurance will only cover health related emergencies. The other benefits of cover for loss of baggage and passport will not be covered under those.

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Image Source: http://www.eduabroadasia.org

What to look for while choosing the right health insurance policy

While buying a health insurance one should look for the following features:

  • Cashless facility – Under cashless facility the insurance company will provide a card which can be used at the time of hospitalization. The bill will be settled directly between the hospital and the Third Party Administrator.
  • The policy should also cover costs of prescribed treatment or medical aid and diagnostic tests suggested.
  • Carefully go through the network hospitals in the list mentioned in the policy documents. It will be convenient if the network hospitals are situated close to the place of your accommodation.
  • Look for waiting period in case of any preexisting diseases.
  • If a policy has certain amount of deductible, this amount refers to the percentage of claim to be borne by the person insured under the policy. Choose policies with either minimum deductible or no deductible at all.
  • Carefully go through the network hospitals in the list mentioned in the policy documents. It will be convenient if the network hospitals are situated close to the place of your accommodation.

  • If a policy has certain amount of deductible, this amount refers to the percentage of claim to be borne by the person insured under the policy. Choose policies with either minimum deductible or no deductible at all.

Apart from providing for medical emergencies, student medical insurance policies also cover non-medical expenses as follows:

  • Expenses incurred for transportation to hospital or nearest physician. Some policies also cover the cost of evacuating the student back to India for medical treatment.
  • Personal accident is also covered under these policies. If any legal claim arises from any third party liability then these policies reimburse for the same on behalf of the insured.
  • Any interruption in the course of study due to hospitalization should also be covered.
  • If a student get hospitalized then then some policies cover round trip travel and accommodation for the family member who visits the student. Again some policies cover only the travel cost and not the accommodation.
  • In case of death of the students sponsor, the tuition fees for the remaining period of education will be paid by the insurance company up to the sum assured.
  • Last but not the least, look very carefully at the exclusions in the policy. Generally cosmetic surgery, AIDS, HIV and other sexually transmitted diseases, damage due to war and natural calamities are excluded. Apart from these what are the specific exclusions in the policy should be looked at.

 

  • If a student get hospitalized then then some policies cover round trip travel and accommodation for the family member who visits the student. Again some policies cover only the travel cost and not the accommodation.

  • Last but not the least, look very carefully at the exclusions in the policy. Generally cosmetic surgery, AIDS, HIV and other sexually transmitted diseases, damage due to war and natural calamities are excluded. Apart from these what are the specific exclusions in the policy should be looked at.

Insurance policies differ from one another. All the above mentioned features will have specific monetary limits up to which they will be provided for. It’s important to compare premiums between different policies but it’s equally important to have read the policy wordings before buying any policy.

It’s important to compare premiums between different policies but it’s equally important to have read the policy wordings before buying any policy.

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