How to Buy Health Insurance in India
In this guide
Step-by-step Process
Understand the Types of Health Insurance
Main types: (a) Individual plan — covers one person; (b) Family Floater — single sum insured shared by all family members (cost-effective); (c) Senior Citizen plan — for people aged 60+; (d) Critical Illness plan — lump-sum payout on diagnosis of listed diseases; (e) Super Top-up — kicks in after base plan exhausted. Most families benefit most from a family floater + super top-up combination.
Decide Coverage Amount
Minimum recommended: ₹5 lakh per person in a metro city, ₹3 lakh in smaller cities. Ideally, aim for ₹10–25 lakh family floater + ₹50 lakh super top-up. Consider: city of residence, family history of illness, number of dependents, and existing employer cover (which stops when you leave the job).
Compare Plans Online
Use aggregator websites like Policybazaar, Coverfox, or Beshak to compare plans. Key factors to check: (a) Claim Settlement Ratio (CSR) — aim for 95%+; (b) Network hospitals in your city; (c) Waiting period for pre-existing diseases (standard: 2–4 years); (d) Room rent limits (prefer no capping); (e) Co-payment clause; (f) Restoration benefit.
Fill the Proposal Form and Medical History
Apply directly on the insurer's website or through an agent. You MUST disclose all pre-existing conditions honestly — non-disclosure can lead to claim rejection. For people above 45 or with health issues, a pre-policy medical check-up may be required (usually paid by insurer). Submit KYC documents (Aadhaar, PAN) and pay premium online.
Receive Policy and Set Up Auto-Renewal
The policy document will arrive via email within 2–3 days. Download and store it in DigiLocker. Set up auto-renewal to avoid accidental lapse (continuous coverage is critical as waiting periods reset on lapse). Review coverage amount annually and increase as medical inflation rises (~15% per year).
Documents Required
- ✓Aadhaar card
- ✓PAN card
- ✓Recent passport-size photos
- ✓Medical reports (if required for pre-policy check)
- ✓Previous policy documents (for portability)
Official Government Portals
Common Questions
Should I buy individual plans or a family floater?
For a young family where no one member is likely to exhaust the full cover, a family floater is more cost-effective. However, if there are elderly parents or members with chronic illness, buy separate individual plans for them so one person's claim doesn't exhaust coverage for everyone.
What is a waiting period and how does it affect me?
A waiting period is the time after policy issuance during which certain claims are not payable. All plans have a 30-day initial waiting period (except accidents). Pre-existing diseases have 2–4 year waiting periods. Specific diseases like hernia, cataracts have 1–2 year waiting periods. Buy early — the younger you are, the lower the premium and shorter the waiting period impact.
Is health insurance premium eligible for tax deduction?
Yes. Under Section 80D of the Income Tax Act: ₹25,000 deduction for self, spouse, children (₹50,000 if any member is a senior citizen). Additional ₹25,000 for parents (₹50,000 if parents are senior citizens). Maximum deduction: ₹1 lakh per year.
Was this guide helpful?