Demystifying Family Floater Health Insurance- Should you go for it or not?

Demystifying family floater health insurance- Should you go for it or not?

Family health insurance is a concept that has gained traction in recent years, particularly family floater health insurance. But what is it all about? There are several theories and perceptions regarding family health insurance of this nature, which may serve to mislead you. Here is a closer look at the basic concept, its key features, and pros/cons. This will help you decide whether to go for it or not.

What is Family Floater Health Insurance and What are the Key Features?

Here are a few points about family floater health insurance for a better understanding:

• This is a specific kind of health insurance policy which safeguards the policyholder and his/her family under a single plan. The annual premium and the total insured amount will be shared amongst all the members of the family accordingly.
• A family health policy could be a good way to cover the entire family while paying a comparatively reasonable or single premium amount.
• Any one member of the family may use the entire coverage amount for any sudden hospitalisation or medical emergency.
• Multiple family members may also use varying amounts of coverage within the overall threshold if required.
• If a single individual uses up the entire or most of the coverage amount, then the others will be left with either nothing or a paltry coverage amount.

What are the Advantages of Family Floater Health Insurance Plans?

The advantages of these plans include the following:

• You can cover your whole family with a single plan, sharing the insured amount and premium. It is easier to manage and pay as compared to multiple health policies.
• You can possibly get savings on your premium amounts by getting everyone under a single plan. The premium is often based on the age of the family’s oldest member. Hence, this option may be more suitable for bigger families.
• You can readily integrate newer family members into the plan, going by the limit of the insurer.
• Any single member can use the whole sum assured for medical treatments. Multiple members can stay within the limit and use varying amounts as well.
• The premium paid will be tax deductible under Section 80D, thereby ensuring greater savings for you.

What Are the Disadvantages of Family Floater Health Insurance?

Some of the cons include the following:

• The whole family shares the insured amount, which may turn out insufficient at times. If someone uses up the whole amount, then the others will not have any financial backup for sudden medical treatments or hospitalisation in the policy period.
• Hence, making multiple claims could be tough in one financial year with this kind of plan. Insurers do have top-up or refill options available at times, although it is only possible for a fixed number of times, subject to specific terms and conditions.
• Family health insurance only covers the immediate family, namely you, your spouse, children, parents, and parents-in-law. Other siblings and family members may not get coverage under the same.

• Dependent children only have coverage under these plans up to the age of 25. Hence, individual policies will be required at this point.
• The premium is based on the age of the oldest member. Hence, if the oldest member is well over the age of 60, then the amount will be on the higher side. Some policies of this nature can only be renewed till the oldest family member achieves the maximum renewability age. Hence, the entire plan is lost after this period along with the accrued benefits in such cases.

Should you choose these plans? You can go for them if you are a comparatively younger family (everyone under the age of 60) and you wish to consolidate all your health insurance needs into a single plan.

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