Why depending only on your employer’s health cover is a mistake

If you depend on your employers’ insurance cover for your health insurance needs, you might be making a silly financial mistake. Why? In the last three years or so, companies are actually reducing employees’ insurance cover or asking them to foot a part of the health bill, especially for their senior parents, notes Business Standard today.

It was only after the slowdown of 2008 when Indian companies started cutting cost, where now they spend around 90 percent less on employee health care needs. In fact, some have also gone and asked employees to pick part of the bill, on an average Rs 1-1.5 lakh. This simply means, it makes total sense for you to have an individual insurance policy of your own as well. This works well, even for those time when you are in between job or switching job. Where the ex-employers’ cover is no longer valid and the new employers’ cover is still not active.

This does not mean that your employers’ insurance is useless. In certain situations, it’s the employers’ insurance cover that will come to your rescue. Take for instance, your employer’s group policy, which gives a maternity cover as soon as you join the job. Unlike the individual policy where you will have a waiting period of a few years.

The report quotes, Divya Gandhi, head – general insurance and principal officer of Emkay Insurance Brokers, who said, “Here the employee should check if the group top-up is in line with the employer-provided scheme. Whereas, individual top-ups are a bit expensive and one should check for base conditions before opting.” Read full Business Standard report here.

Firstpost take: The trend mentioned above is scary. In fact, just recently a survey conducted by insurance broker Marsh, showed that only 36 percent organisations now sponsor cover for dependent parents under employee group mediclaim policies. We at Firstpost think medical cover for each member of the family is a must. We suggest that you buy a separate family floater policy as well. And, ensure that it covers at least between Rs 3 lakh and Rs 5 lakh. Next, look into buying a serious disease disability policy, an accidental death-cum-disability insurance for yourself and wife, if both are working. As far as separate maternity cover goes, the one which employer offers should be good enough. Instead, you should invest in debt-oriented mutual funds through systematic investment plans (SIPs), to build a corpus for planned post maternity expenses. And for your parents, senior citizens’ health insurance policies are available for people between the age of 65 and 80 years. These policies usually offer hospitalisation cover, day care expense, medical expense before and after hospitalisation.

Source: http://to.ly/mdRQ