What is health insurance?
Health insurance is a yearly contract in which you pay a premium and the insurer agrees to pay your medical bills up to a fixed limit, called the sum insured. When you're admitted to hospital, the policy pays for the room, doctors' fees, surgery, medicines and tests, either directly to the hospital (cashless) or by paying you back later (reimbursement).
Hospital costs in India rise faster than most salaries. A single week in a private hospital can wipe out years of savings. A good health policy keeps that one bad week from becoming a financial setback for the whole family.
In one line
You pay a small, predictable amount every year so you never have to pay a large, unpredictable hospital bill on your own.
Estimate your premium ↑Types of health insurance plans in India
Most households need one or two of these, not all of them. Here's who each type is for.
Individual health plan
One person, one sum insured. Best for single earners or anyone who wants cover that isn't shared.
Family floater
A single cover pool shared by you, your spouse and children. Cheaper than separate plans for a young family.
Senior citizen plan
Designed for people over 60, with cover for age-related illness. Usually bought separately for parents.
Critical illness cover
Pays a lump sum when you're diagnosed with a listed illness such as cancer or a heart attack. Use it for income loss, not hospital bills.
Top-up & super top-up
Extra cover that starts after a set amount (the deductible). A low-cost way to raise a ₹5 lakh plan to ₹25 lakh or more.
Group (employer) cover
Given by your employer. Useful, but it ends when you leave the job, so keep a personal plan alongside it.
What a health policy usually covers, and what it doesn't
Usually covered
- Hospital stays of 24 hours or more: room, nursing, ICU, surgeon and doctor fees
- Day-care procedures that don't need an overnight stay, such as cataract surgery or chemotherapy
- Medical costs in the days before admission and after discharge
- Road ambulance charges, up to a limit
- AYUSH treatment (Ayurveda, homeopathy and similar) at recognised hospitals
- Organ donor expenses and treatment at home when hospital beds aren't available
Usually not covered
- Pre-existing illnesses until their waiting period is over
- Cosmetic and weight-loss surgery that isn't medically needed
- Injuries from self-harm, substance abuse, adventure sports or war
- Routine dental work and spectacles, unless the plan says so
- Most claims in the first 30 days, apart from accidents
- Non-medical items such as gloves, toiletries and admin charges
The exact list varies by insurer. Your advisor will share the policy wording before you buy.
8 things to check before you buy
1. Enough cover. Big enough for one major surgery in your city.
2. Hospitals near you. Your local hospitals should be in the insurer's cashless network.
3. Claim track record. Compare claim settlement ratio and average settlement time.
4. Room-rent limits. A cap on room rent cuts every other bill in proportion.
5. Co-payment. Check whether you must pay a share of every claim, common in senior plans.
6. Waiting periods. Shorter waits for pre-existing illness are worth paying for.
7. Restore benefit. Refills your cover if it's used up within the year.
8. No-claim bonus. Extra cover added for each year you don't claim.
Save tax with health insurance (Section 80D)
If you file under the old tax regime, premiums you pay for your family and parents can be deducted from taxable income. The new regime doesn't allow this deduction.
| Who is insured | Self, spouse & children | Parents | Maximum deduction |
|---|---|---|---|
| Everyone below 60 | ₹25,000 | ₹25,000 | ₹50,000 |
| You below 60, parents 60+ | ₹25,000 | ₹50,000 | ₹75,000 |
| You and parents both 60+ | ₹50,000 | ₹50,000 | ₹1,00,000 |
Includes up to ₹5,000 for preventive health check-ups within these limits. Tax rules can change. Confirm with a tax adviser. [Legal/tax review before publishing]
How to make a health insurance claim
Cashless (at a network hospital)
- Show your health card or policy number at the hospital's insurance desk.
- The hospital sends a pre-authorisation request to the insurer or its TPA.
- Once approved, treatment goes ahead and the insurer pays the hospital directly.
- You pay only for items the policy doesn't cover.
For a planned surgery, start this a few days ahead. For an emergency, inform the insurer within the time your policy sets, often 24 hours.
Reimbursement (any hospital)
- Pay the hospital yourself and collect original bills, reports and the discharge summary.
- Fill in the claim form and submit it with documents within the deadline.
- The insurer reviews the claim and may ask questions.
- The approved amount is paid into your bank account.
Bimaask advisors help you prepare documents and follow up with the insurer.
Health insurance FAQs
How much health cover does a family of four need?
In a metro, ₹10–15 lakh as a family floater is a common starting point, with a super top-up to take total cover to ₹25 lakh or more. In smaller cities, a lower base can work. Our calculator shows how the premium changes as you move between levels.
Should I include my parents in my family floater?
Usually not. The floater's price is set by the oldest member, so adding parents raises the premium for everyone, and one large claim can use up the cover for the whole family. A separate senior-citizen plan keeps both covers intact.
Is my employer's health cover enough?
It's a useful extra, but it stops when you change jobs or retire, which is exactly when getting new cover gets harder. A personal plan bought early keeps your waiting periods running and your premium lower.
Can I switch my health policy to another insurer?
Yes. This is called portability, and you request it when your policy is due for renewal. The waiting periods you've already completed carry over. Apply well before the renewal date, since insurers need time to review your application.
What happens if I miss my renewal date?
Most policies give a short grace period to pay. Renew within it and you keep your benefits, though claims during the gap may not be paid. Miss it and the policy lapses: you may lose your no-claim bonus and have to restart waiting periods.