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What Is A Floater In Health Insurance Cover? Everything You Need To Know.

Sep 03, 2018 | 2 years ago | Read Time: 4 minutes | By iKnowledge Team

Salil knew he had to get a health insurance plans for his family. The cost of individual premiums was a burden on his pocket, and yet, he did not want to risk incurring a heavy medical expenditure in case anyone fell sick. The mounting cost of treatment was worrying. He had already seen a colleague under debt to meet treatment costs.

This scenario is not new in India. Many people are out of the ambit of health insurance for one reason or the other. The premiums are prohibitive, and many buy wrong policies because of bad advice, and then never end up renewing them again. There are different types of health insurance policies in India, and choosing the right one is imperative. Family floaters and family health insurance are two health insurance plans for family.

Health Insurance in India

Source: Live Mint

A family floater insurance policy, that covers the entire family, is the best option for people like Salil, who want to be covered under health insurance, but also do not want to burdened with individual premiums.

What is a family floater policy?

A family floater policy is a health insurance plan which covers the entire family on the payment of a single annual premium. The sum assured covers the entire family and can be used in case of multiple hospitalizations in the family.

Health Insurance Cover

Source: Freepik

There are two types of family floater policies:

  1. Medical Insurance: This plan reimburses the cost of hospitalization. The policy specifies a list of illnesses and procedures which are covered. The reimbursement is usually in the form of cashless treatment.
  2. Critical Illness: This policy pays out a lump sum amount to the policyholder in case of diagnosis of a critical illness.

If you want to get an exhaustive critical illness cover, along with the benefits of term insurance, Aegon Life has a term insurance plan called iTerm Plus. It has two variants, Life and Health and Life and Health Plus, which cover different critical illnesses. These policies ensure financial support in difficult times by providing coverage for 10 or 36 critical illnesses, depending upon the variant purchased.

What should I know about a family floater insurance cover?

  1. A family floater works out cheaper when the age of the members covered are lower. The premium for a floater is decided based on the age of the eldest member. This means that the premium for including senior citizens in the policy is quite high.
  2. The policy can be renewed till any member of the policy reaches a age. Most insurance companies have this age as either 60 years or 65 years. When anyone in the family reaches that age, the floater policy lapses.
  3. The policy includes children up to a age. Beyond that age, they are treated as adults, and will have to get their own health insurance policies.

But why should you get a family floater health insurance cover?

A family floater plan is the best way to get health insurance for the family. It brings all the family members under one policy. It is easy to add new members, and some family floaters allow coverage for joint families as well these days. Companies are coming out with newer variants of the family floater policy to provide different health insurance plans for family.

Family floaters are also light on the pocket in terms of the premium. If the insurance covers a married couple, the premium for both will be lesser than under individual policies. The premiums for most floater policies are less than that for individual policies.

It is possible to add on parents and even in-laws in the policy. This ensures comprehensive coverage. Some policies have maternity costs included in its regular coverage, or as an add-on. The baby is also added to the family floater in such cases.

The best advantage of a family floater is sharing the sum assured. Even if one of the members is hospitalized, using up a portion of the sum assured, the balance is available for all the members, should the need arise. This flexibility is not available in individual policies. Some family floater variants have started coming out with dual assured policies, which means, everyone has a sum assured, and there is a floating sum assured available for the entire family.

Family floater premiums also save tax under Section 80D, but only when the premium is paid for self, spouse, children and parents. If the premium is paid for everyone in a joint family, a portion of the premium will be disallowed as a deduction.

How can I get the best family floater cover?

There are a few tips to ensure you get the best family floater plan optimized for your family:

  1. Check the coverage under the policy, whether it covers pre- and post-hospitalization, day care expenses, maternity costs. If any add-ons are required, clarify the same.
  2. The family floater lapses when the age of any member in the family reaches a age limit. (60-65 years). Some companies offer lifelong renewal, so it is better to clarify that.
  3. It is better to get a sum assured that will satisfactorily cover the needs of the entire family. Also, it is best to clarify the procedure for enhancing the sum assured.
  4. Many companies have cashless treatment facilities. Getting a list of network hospitals will ensure there are no problems later.

Family floaters have their own set of advantages. They are meant for families who want comprehensive coverage at a reduced cost. Whether the final investment is made in a family health insurance or a floater cover, it is essential to shield against uncertainties. Health insurance is a boon and a must for family finance planning.

Advt. no.: II/Aug 2018/4332


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