Different Types of Health Insurance Policies in India – A Detailed Guide to Indemnity and Fixed Benefit Health Insurance Plans

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A Peek into the Different types of Health Insurance Plans in India and Their Key Features.

Health plans in India come in different variants. Each variant offers tailor-made insurance coverage for different needs. Let us explore the different types of health insurance plans available in the health insurance sector.

Let us first begin by understanding a little bit about the meaning of health insurance.

What is Health Insurance?

In simple words, health insurance is financial protection provided to an individual/family/group to help them deal with uncertain medical emergencies. A sudden hospitalization need can end up burning a hole in your pocket. This is where purchasing health insurance is a wise decision. It would take care of all unexpected expenditure for treatment of critical illness or during hospitalization.

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Types of Health Insurance Policies in India

Firstly, we can divide health plans into two categories – indemnity health plans and fixed benefit plans. Each category is then subdivided into different types. Let’s understand.

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Indemnity Health Insurance Plans

Indemnity health plans are those types of health insurance policies which pay the actual amount of expenses incurred on medical emergencies. The maximum limit of claim is the sum insured.

Fixed Benefit Health Insurance Plans

These plans pay a fixed amount of claim irrespective of the actual expenses incurred. The fixed claim payable is mentioned beforehand and is paid if the claim is incurred.

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What are the Subtypes of Indemnity and Fixed Benefit Health Insurance Plans?

Here are the sub-types of both types of health insurance policies:

Types of Indemnity Health Plans

  • Individual Health Insurance Plans – This policy covers a single individual on a single sum insured basis.
  • Family Floater Health Insurance Plans – The whole family can be covered under a family floater health plan. A single policy is issued with a single sum insured. The family members share the sum insured on a floater basis where each member can utilize any amount up to the sum insured. Family includes self, spouse, dependent children and dependent parents. Some plans also offer coverage for extended family members too.
  • Senior Citizen Health Insurance Plans – These health plans are specifically designed for covering senior citizens who are aged 60 years and above. The plan has a low waiting period and limited sum insured option.
  • Top-up Health Plans – Top-up plans are designed to supplement your health insurance coverage at minimal premium rates. There is a deductible limit under the plan. If the claim is more than the deductible limit, it is paid.
  • Super top-up plans – These plans are also like top-up health plans where there is a deductible limit. However, the deductible is applied on the aggregate claims made in one policy year and not on each claim.
  • Disease Specific health plans – Under these plans, specific ailments are covered. The plan covers hospitalization and medical expenses which are incurred on the specified illness covered by the plan. Common disease specific plans include plans designed for diabetics, heart patients and dengue.

Types of Fixed Benefit Health Plans

  • Critical illness plans – These are the most popular fixed benefit health insurance plans. Critical illness health insurance plans cover a list of specified critical illnesses. If the insured is diagnosed with any one of the covered illnesses, the plan pays the sum insured in lump sum irrespective of actual medical costs incurred.
  • Hospital daily cash plans – These plans provide an additional coverage benefit in case of hospitalization which is for a minimum of 24 hours. Under hospital daily cash plans, a fixed benefit is paid in the event of hospitalization. This benefit is fixed at the time of buying the plan.

Besides the above-mentioned types of health plans, group health plans are also available. These plans cover the members of an identified group. The most common example is the employer sponsored group health insurance plan taken on the life of employees.

Various Types of Health Insurance and Who is It Ideal For?

Let us now take a quick look at whom these various health insurance plans are most suitable for:

Type of Health Insurance Plan Who is it Ideal For
Individual Health Insurance Plan Individual/One Person
Family Floater Health Insurance Plan Family members of policyholder (spouse, kids, parents)
Senior Citizen Health Insurance Plan Elderly over 65 years old
Top-Up Health Insurance Plan Policyholders who have a health insurance plan but its sum insured has been used up can top up the plan with this policy
Super Top-Up Health Insurance Plan Similar to Top-Up plans but with a deductible limit
Disease-Specific Health Insurance Plan (Corona Kavach or M-Care) Those diagnosed with health conditions that are a fallout of COVID
Critical Illness Health Insurance Plan Those diagnosed with critical illnesses which may even result in death within 12 months
Hospital Daily Cash Health Insurance Plan Those who require hospital expenses on an everyday basis, particularly during long-term hospitalization
Personal Accident Health Insurance Plan Individuals
Mediclaim Health Insurance Plan Those in need of expenses for treatment as in-patients during hospitalization
ULIPs Health Insurance Plans Those interested in reaping dual benefits of insurance protection and investment returns
Group Health Insurance Plans Suitable for group of employees working together in an organization

Choose the suitable types of health insurance policies for your needs when you are buying health insurance.

Choose wisely!

Also Read:

FAQs on Different Types of Health Insurance Policies in India

What are the 5 types of health insurance?

The 5 different types of health insurance plans in India are:

1. Individual Health Insurance Plans
2. Family Floater Health Insurance Plans
3. Group Health Insurance Plans
4. Senior Citizens Health Insurance Plans
5. Maternity Health Insurance Plans

What are the 7 types of health?

Health and wellness is generally viewed as having 7 different areas:

# Physical health
# Mental health
# Financial health
# Environmental health
# Spiritual health
# Social health
# Vocational health

What are the 4 basic types of insurance?

The 4 main types of insurance that every individual must consider investing in include:

1. Health insurance
2. Life insurance
3. Auto/motor insurance
4. Long-term disability insurance

What is 4-year waiting period in health insurance?

Generally, all health insurance policies in India provide coverage to the insured for any pre-existing diseases after a waiting period that lasts between 2 and 4 years. In other words, this simply means that the insured can claim for hospital expenses only after the completion of 4 years of the policy with the said insurer.

Can I buy 6 months health insurance?

Yes, there are short-term health insurance plans available with a validity of only 6-12 months. These short-term plans are designed to cover expenses related to ambulance charges, pre- and post-hospitalization, expenditure on organ donation, and such.

Mar 17, 2021
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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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