⁠Individual Plans vs Family Floater: Which One is Right for You?

While health insurance is a necessity for everyone, the ‘one-size-fits-all’ approach is not applicable here. While some may be looking to get a policy for their entire family, some may just need single-person coverage. Choosing the right health insurance policy is very important. Not only does it make a difference in the extent of the coverage, but also in your budget. Two of the most popular types of health insurance policies are individual plans and family floater health insurance.

Understanding the key differences between the two will provide you with greater clarity regarding which one to choose. In this guide, we will discuss the differences between these two, their working mechanisms, coverage, and premiums. Read on to make an informed decision when choosing the right health insurance policy.

What is Individual Health Insurance?

As the name suggests, individual health insurance provides coverage for a single person. With this policy, you can get coverage for one person, who then gets their sum insured. Depending on the type of health insurance and insurer, the coverage may differ. The policy covers inevitable medical contingencies, such as diseases, accidents, and disasters.

What is Family Floater Health Insurance?

A single health insurance policy that covers the health of your entire family is known as a family floater health plan. This policy covers multiple individuals, such as spouses, children, parents, and parents-in-law. So, depending on your needs, you can get the most suitable health insurance for your entire family.

Often referred to as an umbrella policy, it provides coverage against unforeseen health crises, including accidents and diseases. In a family floater health insurance policy, the sum insured amount is shared among all the insured members. So, anyone in need can use the sum insured. This is why it is referred to as a family floater health plan. Additionally, a senior citizen health insurance plan can be considered for older family members who may need specialised coverage.

Highlighting Differences Between Individual and Family Health Insurance

When it comes to choosing the right health insurance, whether for yourself or your family, it is essential to understand the key differences between individual and family health insurance plans. Let us understand the differences with this example:

A 26-year-old woman, Megha Tiwari, buys individual health insurance for ₹5 lakh. Her husband has a similar plan for ₹7 lakh. They can both individually claim up to their respective coverage amounts. On the other hand, their friend Priya has a family floater plan of ₹5 lakh that covers her, her husband, and daughter. Any one of them (or all together) can use up to ₹5 lakh in a policy year. Unlike Megha and her husband, the family of 3 have to share the sum insured among them.

Look at the table below to better understand the differences between the two types of health insurance:

Individual Health Insurance	Family Floater Health Insurance
Individual health insurance plans provide coverage for a single person	Multiple individuals can be covered under family health insurance plans
The sum insured amount cannot be shared with other members	The sum insured amount is shared among all the insured members
The premiums for individual policies are usually higher than family floater	Considering the number of people insured, a family floater usually costs less than individual health insurance plans
The age and overall health of the individual play a decisive role in the premium	The age and overall health of the eldest member are considered for premium calculation
The policy is suitable for those looking for single individual coverage	Family floater health insurance is good for people who want a single policy for their entire family
An individual health insurance covers a single person, and so, the policy does not offer much flexibility	Family floater is a flexible policy as you can get multiple lives covered, like spouse, dependent children, parents, and parents-in-law
Tax benefits can be availed for both individual and family health insurance policies. Under Section 80D of the Income Tax Act.

Which is Better: Individual or Family Term Insurance?

As discussed above, in health insurance needs, there is no best type of policy. The choice depends on specific needs and preferences. For instance, an individual health plan may be most suitable for a bachelor whose parents already have health insurance. However, someone with a family consisting of a spouse, children, and parents may opt for a family floater policy to cover everyone in the family. Alongside health insurance, having a term insurance plan can provide additional financial protection for your loved ones.

Therefore, the key to selecting the right policy that caters to your needs lies in understanding your specific requirements. When you know the type of coverage you want, choosing the right type of health insurance becomes easier.

Over To You

Health insurance has become one of the essential purchases for anyone. In today's times, when health awareness is increasing and medical costs are continually rising, having health insurance is a bare minimum. Gone are the days when medical insurance was a luxury.

A single hospitalisation can wipe off a major chunk of your savings. That's a situation no one wants to be in. Since health emergencies remain unforeseen and inevitable, it is wiser to have financial support, such as health insurance. You can also consider a super top up health insurance plan to enhance your existing coverage at an affordable cost. If you haven't already insured yourself or your family, now is the right time. Compare various plans available to choose the most suitable one for your loved ones!

Over to You

Care Health Supreme and HDFC ERGO Optima Restore are among the best health insurance policies in India today. It is a matter of your priority, coverage depth over cost effectiveness. Here’s a quick recap for you to make an informed decision.

Both offer coverage of up to ₹1 crore; Optima Restore starts at ₹3L, Care Supreme at ₹7L. Supreme offers unlimited recharge; Optima Restore offers 100% once a year, after a claim is made. Care includes OPD + unlimited e-consults; Optima lacks OPD, allows one consultation/year. Care gives a 30% discount + 500% bonus; Optima offers 8% discount + 50% bonus. Care Supreme is costlier but has more features. Optima suits budget buyers; Care fits those needing wider, long-term coverage.

Whichever health insurance plan you choose, ensure to read the policy wordings and seek advice from an expert before you make the purchase. The best health insurance is the one that covers you the way you want to be covered.

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Author Bio

Paybima Team

Paybima is an Indian insurance aggregator on a mission to make insurance simple for people. Paybima is the Digital arm of the already established and trusted Mahindra Insurance Brokers Ltd., a reputed name in the insurance broking industry with 17 years of experience. Paybima promises you the easy-to-access online platform to buy insurance policies, and also extend their unrelented assistance with all your policy related queries and services.

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