Is investment in health insurance worth it?

Yes, having a health insurance can be expensive and it can make you feel that part of your salary is being wasted, especially if you are fit and healthy. But not having one can be financially devastating, especially if you are not ready for a financial shock and have other financial priorities to tend to.  

Health insurance is basically financial protection offered by insurance companies under which the insurance company either

• Reimburses your medical expenses incurred at the hospital.
• Directly pays your bill at the hospital (termed cashless hospitalization).

SO, WHY DO YOU REALLY NEED A HEALTH INSURANCE?

Pappu plays cricket every other day with his friends in the nearby colony. During a match, the batsman accidentally hit Pappu's head instead of hitting the ball while he was running towards the wicket. Pappu started bleeding profusely and had to be rushed to the hospital. He had to get stitches on his forehead and his parents were worried, but not for too long. Even though they didn't have much savings left, they had judiciously paid their family health insurance premiums every year.

• This helped them get Pappu, their sole family asset, into the hospital emergency room immediately and save his life.
• Say, if Pappu had needed serious surgery (instead of stitches), it would have caught his parents off guard. Especially if they did not have health insurance. His parents might have had to spend their entire life savings. By having health insurance, their life savings were saved. 
• Also, the health insurance policy helped Pappu's parents fight medical inflation and fight these health issues. Also, since their kid was young, their kid's health insurance premium was really inexpensive as compared to their own. 

IS IT WORTH IT?

As per a report called ''Key Indicators of Social Consumption in India'', medical costs increased by about 8 times from 2017 to 2020. In 2020, an individual would have to spend Rs 32,000 for a day at a private ICU facility. Add to this other hospital charges that are normally levied which include: 

• Ambulance charges
• Hospitalization charges
• Laboratory services 
• Special room rent
• Prescription drugs
• Diagnostic tests 
• Emergency charges 
• Doctor's check-up charges
• Surgery costs 

All this (and much more) adds up to make a hefty hospital bill.

Even if you are financially comfortable, hospital bills can shock the bejesus out of you and your family. When a loved one is in the hospital, it is very difficult for you to say no to expensive treatment just because you cannot afford to pay for it at the moment. 

Health insurance will be like that loaded best friend who has tons of cash at their disposal, waiting to be used by you when you need a large number of funds. It is worth the money you spend because at least, you will ensure that your life savings are not wiped all of a sudden and that you don't have to borrow from others.  

TAX BENEFITS 

• If you pay health insurance for your family and your age is less than 60, you are eligible to receive a tax deduction of Rs 25,000.
• If you pay your parents' health insurance too, you can claim Rs 75,000 deduction considering that they are senior citizens. ( Rs 25,000 of your own and Rs 50,000 for your parents)
• If you and your parents are both above 60 years, you can claim about Rs 1,00,000 in deductions (Rs 50,000 each for you and your parents)

So yes, health insurance is definitely worth it.