How do You Choose Between Individual and Family Health Insurance Plans?

Medical contingencies are unpredictable. Having a reliable, comprehensive health insurance plan can save your day well without compromising on the quality of healthcare. Rather than buying separate health plans for each family member, you can opt for family health insurance coverage that includes your parents, spouse, and dependent children. 

What is a family floater health plan? 

This typical health cover covers the full family under a single umbrella plan. One single sum insured is shared among all the members included. This means that all the included family members can avail of the policy benefits up to the sum insured limit. The premiums of such plans are decided based on the age of the oldest family member and the chosen coverage span.  

You must note here that the existing coverage gets shared among all the family members in the chosen policy as required. Such exclusive comprehensive coverage for all the family members proves more reasonable than separate plans.  The claims get settled according to the specific regulations of the chosen insurer and the plan terms.  

Individual health insurance 

This is a very popular form of health insurance, ideally designed to cover one individual. Each family member needs to maintain a separate health plan under this system. The principal determinants of premiums for this kind of plan include the current health status, age, and probable risk profile of every insured individual.  

If you aren’t seeking health coverage for multiple family members, then you can go for this. Moreover, if there are members in your family who require special coverage for critical illness, cardiovascular issues, cancer, etc., it is best to maintain separate health plans.  

Differences between individual and family health insurance plans 

The key differences between individual and family health insurance plans are as follows: 

Flexibility and coverage:  

In the case of an individual plan, the sum insured amount can be utilised flexibly as and when needed by the insured individual.  
However, in a family floater plan, the total sum insured amount is shared among all the family members. If one exhausts a considerable amount, it may come in the way of others till plan renewal.  
 
Pro Tip: If you have a senior citizen or a member with a critical ailment for whom there could be multiple claims in one year, it is best to opt for a separate individual health plan for that person rather than including him/her in the family floater plan. 

Premium calculation:  

The oldest family member's current age and health status are the significant determinants of the premium payable amount in the family floater plan. However, the age, health profile, and associated risks are considered in individual plans. This may vary for each member, thereby altering the premium. 
 
Pro Tip: Ideally, a family floater plan should be taken for members of similar age. A separate family floater plan can be taken for senior family members. 

Coverage for dependents:  

A standard family health plan allows coverage for the whole family, including the principal policyholder, spouse, dependent children, and sometimes dependent parents. Some plans also allow coverage for parents-in-law as well. 
 
An individual plan only covers the insured person concerned. Each family member requires a separate individual plan to ensure coverage. 

Price:  

The price of a family floater plan is slightly more reasonable than maintaining separate health plans for every individual family member, especially when there are more than 2 members. 

Let’s understand the basic difference between the two. 

Aspect  Individual Health Plan  Family Floater Plan 
Coverage   Separate coverage for every insured  It gets shared among all the included family members 
Premium Calculation  Based on the age, health status, and risk profile of the insured individual  Based on the age and health status of the oldest family member, included 
Dependent Coverage  Solely covers the insured person  Spouses, dependent children, and sometimes dependent parents are covered 
Price  Depends on the policy choice, coverage span, etc.  A single premium for every member might be lower than a single policy for every member. 

 

Individual health plan vs. family floater plan: which works best for whom and why? 

While making the choice, you must critically analyse the specific conditions of your family. If multiple members are without coverage, then choosing a family floater plan could be a favourable solution. However, if that is not the scenario, you can choose individual health plans. Nevertheless, whichever you choose, you have to research multiple plans and grab the best deal critically. 
 
For example, individual health plans work best for young professionals, single people, or those without dependents. It works for senior citizens or high-risk individuals with pre-existing medical conditions or a higher likelihood of claims. Also, if you have specific requirements like critical illness coverage or maternity requirements, individual plans could be a better solution as they can be customised to meet your needs. 

On the other hand, a family floater plan is a better solution if you are looking for coverage for a young family with couples and small children, with a low likelihood of simultaneous claims. Also, for families without chronic illnesses or pre-existing conditions requiring frequent claims or if you need an economical option, you could avail of a family floater plan. 

 

Wrapping it up 

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.
Speak to an Advisor

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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