Health Insurance Basics: A Clear, Practical Guide for Indians
Health insurance isn’t about saving tax or getting returns. It’s about protecting your savings when medical emergencies strike.
One serious hospitalization can wipe out years of savings. Health insurance exists to prevent that — not to make profits.
What Is Health Insurance?
Health insurance covers major medical expenses such as:
- Hospital room charges
- Doctor and surgeon fees
- Medicines and diagnostic tests
- Surgeries and intensive care
✅ Health insurance protects your savings —
not your lifestyle or comfort.
Why Health Insurance Is No Longer Optional in India
- Medical inflation in India is around 12–15%
- A single hospitalization can cost several lakhs
- Employer insurance often ends when you need it most
⚠️ Relying only on employer health insurance
is one of the biggest financial risks for salaried Indians.
Health Insurance Terms You Must Understand
| Term | What it means |
|---|---|
| Sum Insured | Maximum amount the insurer will pay in a year |
| Room Rent Limit | Cap on room charges that affects overall claim |
| Co-payment | Portion of bill you must pay from your pocket |
| Waiting Period | Time before certain illnesses are covered |
| Network Hospitals | Hospitals eligible for cashless treatment |
❌ Ignoring room rent limits and co-pay clauses
can significantly reduce claim payouts.
How Much Health Insurance Cover Do You Really Need?
The right health insurance cover depends on:
- Your city (metro vs non-metro)
- Age and family size
- Existing medical conditions
🎯 Under-insuring is far more dangerous than over-insuring
when it comes to health.
Tax Benefits Under Section 80D
Health insurance premiums qualify for tax deduction under Section 80D — over and above Section 80C.
| Who is covered | Maximum deduction |
|---|---|
| Self + family | ₹25,000 |
| Parents (senior citizens) | ₹50,000 |
Common Health Insurance Mistakes to Avoid
- Choosing the cheapest policy instead of adequate cover
- Ignoring policy wording and exclusions
- Delaying purchase until health issues appear
❌ Health insurance should be bought early —
before you need it.
Health insurance is financial shock protection.
It doesn’t prevent illness — it prevents financial ruin.