How Early Health Insurance Investment Builds Wealth Security

Investing in health insurance early is not only about covering medical bills. It is also about laying the foundation for long-term wealth security and financial peace of mind. With health insurance investment, you can secure reliable coverage even before illness strikes. You can preserve your savings and shield yourself from potentially catastrophic expenses during medical emergencies.

Healthcare costs are escalating significantly, and every premium you pay for health insurance can be considered a tiny investment towards stability. Health insurance has become an essential pillar of wealth security, supporting your entire future.

This blog covers details about health insurance, including details like how these plans work, wealth security benefits, early investment advantages, and more.

 

Why Health Insurance Should Be Viewed as an Investment

One common question many people ask is, 'Is health insurance an investment?'. The answer is yes. Health insurance is definitely an investment. The reasons are:

Reasons	Details
Broader coverage and lower premiums when purchased early	If you purchase health insurance when you are young, you have to pay lower premiums. This means saving on funds. Also, there are fewer exclusions for pre-existing conditions. It is possible to access better coverage for expensive health issues.
Protection against surging medical expenses	Medical inflation is surging. Surgeries, hospitalisation, and medication are getting expensive with each passing day. Health insurance investment plans save your savings from unprecedentedly huge bills during emergencies.
Financial stability and peace of mind	You can plan your life confidently knowing that you are covered for major health risks.
No claim bonuses and rewards	Many health insurance policies offer no-claim bonuses. By not making claims, you might get discounts on premiums or enjoy an increased sum insured. This indirectly helps you save money with lower premium payments.
Tax benefits and savings	Health insurance premiums in India offer tax deductions under Section 80D. This minimises the taxable income and helps you save on premiums.

 

How Does Insurance Investment Work?

Here is a step-by-step breakdown of how does insurance investment works.

You choose a health insurance policy and pay a premium

You choose a health insurance policy and pay regular premiums to the insurer. The insurance company bears the medical expenses during a medical emergency.

You get the coverage and benefits

The services that you will get will depend on the health insurance policy you have chosen. Different policies have different services, like hospitalisation, preventive care, diagnostics, medicines, doctor visits, etc.

In case of pre-existing health conditions, there may be waiting periods to avail full benefits.

Claims process: reimbursement vs cashless

There are two processes for claim settlement: cashless and reimbursement.

If you are hospitalised in the insurer's network hospitals, the insurer settles the bills with the hospital directly. This cashless facility minimises the upfront outlay.

However, in other cases, you can pay the bills and later submit the bills and receipts to the insurer for reimbursement. The covered expenses will be as per policy terms.

Out-of-pocket expenses

Sometimes, you might have to pay deductibles, co-payments, or certain charges such as room rent limits, some medicines, medical equipment, etc., that are beyond the policy coverage.

 

Health Insurance with Investment Plans in India

One of the most sought-after financial products that is in high demand in India is a combination of health insurance plus investment plan. Known as unit-linked health plans (ULHPs), they combine health insurance and various other investment components.

The premium paid for such health insurance with investment plans gets divided into portions.

• Investment funds: One part of the premium goes into investment funds like bonds, stocks, equity, and mutual funds. The policyholder can invest in funds of their choice, depending on investment goals and risk appetite.

The value of this investment part will vary depending on the performance of the invested funds. When the funds perform well, the investment grows.

• Health coverage: The other part of the premium goes towards providing health coverage for medical expenses like hospitalisation, critical illness coverage, day care, surgeries, outpatient expenses, and more.

The coverage and premium amount of the health insurance part will depend on the age, health condition, and type of coverage that the policyholder wants.

The majority of leading insurance companies in India offer comprehensive health insurance plus investment plans for customers.

 

Long-Term Wealth Security Benefits

Are you interested in knowing about the long-term wealth security benefits of health insurance plans? Here are some of the most important ones:

Benefits	Details
Predictable premiums and costs	Long-term health plans lock premiums for 2-3 years. Even in the case of increased age or medical inflation, the premium remains the same. As the premium costs remain predictable, you can plan your annual budget accordingly.
Financial leverage and tax savings	In India, you qualify for tax deductions under Section 80D for paying premiums. This reduces the overall taxable income. As health insurance helps avoid unpredictable medical expenses, you have the flexibility of investing or allocating funds to other sectors for wealth growth.
Protection of savings and assets	Health issues can lead to unexpected medical expenses. With health insurance in place, you don't have to break your investment income, retirement savings, and emergency funds. When the major costs of medical bills are borne by the health insurance, your assets remain preserved.

 

Early Investment Advantage

In India, you can choose a solo health insurance investment or a combination of health insurance plus investment plan. Whatever the investment plan, make sure that you invest as early as possible. Here are some early investment advantages in health insurance plans:

Benefits	Details
Wider and better coverage choices	Younger people have choices for more plans with better options for sum insured, wellness perks, add-ons, and more. Ageing reduces the choices.
Lower premiums	If you take a health insurance plan early, the premium is quite low. Insurers assume lower health risks in younger people.
Tax savings over many years	Tax deductions are applicable for premium payments of health insurance. If you start early, you get the benefits for more years, saving money in the long run.
Easier approval and fewer rejections	It is unlikely to have serious health issues early in life. This implies negligible chances of getting rejected or having exclusions imposed.
Protection against surging medical expenses	Every year, healthcare costs increase due to treatment, medicine, and hospitalisation costs. Early health insurance offers protection against these future surges.
Completing waiting periods sooner	Health insurance policies often have waiting periods for certain conditions or treatments. When you purchase the health insurance early, you get to complete these waiting periods while you are healthy.
Loyalty rewards and no-claim bonuses	You must start early to build up loyalty rewards and no-claim bonuses. With the bonuses, you can lower your renewals, enjoy added perks, and increase the coverage.

 

Things to Consider Before Choosing a Health Insurance Investment Plan

Choosing the right health insurance investment plan is a challenging job, with so many options to choose from. Here are some essential factors you must check before finalising on a plan:

• Sum insured/coverage amount: Ensure that the sum insured can cover high-cost treatments, medical inflation, and expensive city hospital rates. The coverage should match your family size, health risks, and financial capacity.
• Hospital network and cashless facility: Before purchasing the health insurance, check the hospital network with which they are associated. Getting treatment at a network hospital facilitates cashless treatment. This claim settlement takes place between the hospital and the insurance provider.
• Premium amount and services offered: People often choose health insurance investment with a low premium amount. However, in such policies, you might not get various services. Compare premiums across various policies, along with the services you will get.
• Inclusions and exclusions: Check the services that are covered in the policy, pre and post-hospitalisation, day care, maternity, ambulance charges, AYUSH, etc. Also, ask about the exclusions, as some policies exclude certain treatments, illnesses, or medical components.
• Claim settlement ratio and insurer reputation: Enquire about the claim settlement ratio and the success rate of the insurer. See how smoothly the insurer handles the claims. Look for insurers with high claim settlement ratios.

 

Conclusion

Early health insurance investment helps secure your future physically as well as financially. Once your health is insured with a reliable health insurance policy, you can plan investments for other sectors like education, retirement, home, and more. In the long run, you build a foundation for wealth security.

At ManipalCigna Health Insurance, you can choose from a wide variety of health insurance investment plans, with varied features and benefits. Browse through the plans and select the one that best fits your requirements. The insurance provider offers comprehensive health insurance plans for every phase of life with quick claim settlements, an extensive network of hospitals, round-the-clock customer service, and more. Insure your health and enjoy peace of mind with the amazing health insurance policies offered by ManipalCigna Health Insurance.

 

FAQs

What is health insurance with investment benefits?

A health insurance plan with investment benefits is a hybrid policy combining health insurance coverage and investments in various financial instruments like bonds, funds, or equities. The policy is not a pure insurance plan but has a strong investment angle.

Which plan gives benefits of both insurance and investment?

There are unit-linked health plans (ULHPs) that combine health insurance and various other investment components. These plans offer benefits for both the investment and insurance plans simultaneously. The premium paid is also channelised in both segments.

Is it good to invest in health insurance?

Yes, it is highly recommended to invest in health insurance. In fact, insurance experts advise purchasing a health insurance policy at an early age for the numerous benefits that come with it. Health insurance not only provides coverage during medical emergencies but also offers peace of mind. It is also a great step towards building wealth security.