Things to Consider Before Buying a Second Health Insurance Policy

Buying a health insurance policy is much more than just a convenient way to budget for potential health care expenses. The importance of health insurance is that it provides vital economic protection to individuals and families should someone have a serious accident or illness. It protects income, savings and other personal resources from being wiped-out due to costly medical bills.

Traditionally, most individuals obtain a health insurance policy by buying private health insurance. A majority of private insurance is purchased through policies sold to employers who offer it as a benefit to their employees. These policies are known as Employee Health Insurance. However, most Employee Health Insurance plans have certain limitations. This could be in the form of limited coverage, in the form of co-pay clauses or room rent limitations. To address this deficit, an easy solution is to buy a second health insurance plan that makes up for all the shortfalls of the primary plan. So, should you buy a second health insurance policy? Here are a few things to know before buying health insurance that will help point you in the right direction.

Do I Need a Second Health Insurance Policy?

Before you consider buying a second health insurance policy it’s important to look at your current health insurance plan and understand the potential future health requirements for you or your family. If your primary plan does not cover your dependent parents, then it’s a good idea to go for additional coverage. It is also important to know your health needs as well. If you are someone who suffers from heart disease, or other chronic illnesses, it's critical to take on a second individual health plan that covers you for a specific illness.

Let’s take a look at an example to understand the second insurance plan a bit better.

Satish lives in the city of Lucknow. After years of living alone, Satish’s parents finally move in with him in the city. Satish’s father who worked in the Army recently retired and is looking to spend him retirement years in peace and quiet. Satish works for a corporate firm that provides Employee Health Insurance as part of the employment benefit package. Unfortunately, the insurance plan does not cover his parents. Satish immediately goes in for a Family Floater plan as a second insurance policy. The additional coverage gives Satish and his parents complete peace of mind as a safeguard against future medical exigencies.

Second Insurance Plan to Cover Against Covid-19

With the second wave of the Covid-19 virus making headlines once again, protecting ourselves and our family members from this deadly pandemic is absolutely paramount. Opting for a second insurance plan that is targeted specifically to cover against covid-19 is to ensure we remain protected through these difficult times. These plans provide coverage for all medical expenses incurred by members during the treatment of the disease.

Benefits of a Second Health Insurance Plan

There are a number of benefits of a second health insurance plan. As explained earlier, the second insurance plan extends your medical coverage and limits or eliminates out of pocket medical expenses. These are some of the benefits of a second medical insurance plan.

1. Wider Coverage

The second health insurance plan will give you the benefit of a wider coverage. Depending on what your first plan doesn’t not cover, you can opt for a second plan to make up for all the shortfall of the first plan. With rising medical costs, extended coverage ensures that out of pocket medical costs are completely eliminated.

2. Specific Medical Illness Coverage

A second insurance plan can be used to cover specific medical illnesses that have not been given priority in the first plan. Most insurance policies cover basic medical needs like hospitalization expenses and check-ups. Your second insurance policy can cover specific critical illnesses like cancer that are more deadly and require a lot more coverage.

3.Maternity Cover

A second insurance plan can give you the much-needed maternity coverage that most generic plans don’t cover. With maternity costs going through the roof, most families make the mistake of not getting adequately covered for all the maternity care including pre-check-ups and post-delivery care. A second insurance plan that provides adequate maternity cover will pave the way for a smooth delivery experience.

4.Protection from Employment Redundancie

A majority of private health insurance is provided by employers as part of employee retention or employee satisfaction strategy. But do you still get to retain your insurance if you leave the company?  Unfortunately, most employer health insurance plans expire the day you resign from the company. This leaves you unprotected in the event of a medical emergency if you are without a job. A second medical insurance plan will ensure that you remain covered regardless of whether you are employed or have taken some time off from work.

5. Tax Saving Benefits

Finally, having a second insurance plan can help you save on tax. Under section 80D of the Income Tax Act, all premiums paid towards family, individuals or specific health insurance are applicable for tax benefits.

Conclusion

With rising medical costs, a second health insurance plan has a number of benefits that are revealed when an emergency strikes. If you are looking to cover your extended family or you are suffering from a critical illness, a second plan is absolutely essential. Before you decide to buy a second medical insurance, make sure to go over your current plan to see your medical coverage. Once you have a good idea of what’s covered and what’s not, only then should you decide on what second insurance plan to buy.

FAQs

1.   Can I buy two health insurance policies from the same insurance company?

Yes, you can buy multiple health insurance policies from the same insurer.

2.   I want to switch my Individual plan to a different insurer but continue the Family Floater plan from the same insurer. Can this be done?

Yes, this type of change is possible.

3.   Can I raise a claim from two health insurance companies?

In some cases, two different insurance companies come together to settle the claim. It depends upon the contribution clause and other terms and conditions of the policy.