Akshay Yadav was a 35-year-old who had recently had a baby. His six-month-old daughter had brought him a lot of happiness. But it meant a lot of expenses too. From the health check-ups to the vaccines, everything had a big cost attached to it. Akshay realised how expensive it was to have a child. Even a couple of years ago, he had been young, single, and carefree. He did not invest in a health insurance plan. But he now realised that had been an error in judgement.

Health plans are mandatory nowadays. Most people cannot afford to pay the bills of a private hospital entirely out of their own pockets. This can be a problem if an emergency strikes. So, it is wise to invest in a health insurance plan beforehand. This keeps your health and your wallet protected.

What is health insurance and how does it work?

Health insurance is a kind of insurance cover. It pays a sum assured when a medical emergency strikes. Commonly, health plans provide coverage for hospitalisation. They cover all the medical treatments you receive during an overnight hospital stay. There are other kinds of health covers available too. What is the main purpose of health insurance? It is to provide financial support when you need it the most. This support is provided in exchange for the premiums that you pay. You can choose a basic plan or a comprehensive plan. The type of cover you get will depend on the type of health insurance you buy.

Types of health insurance policies in India

There are many types of health insurance policies in India. Here are some of them:

  1. Hospital cover: This is the most common kind of health insurance available in India. The insurance provider pays the sum assured when you receive treatment in hospital. The policyholder must spend a minimum of 24 hours in the hospital or nursing home in this case. Only then will the insurer make the necessary payout.
  2. Critical illness plan: Here, the policyholder gets a fixed sum of money if he or she is affected by any one of the listed illnesses. The policyholder can then use the money in any way. Some may use it to travel abroad for treatment. Others may use it to compensate for a discontinued salary, or take care of some other expense.
  3. Maternity insurance: This is another type of health plan that is gaining in popularity. Maternity insurance has a specific purpose. This is a useful type of health insurance as maternity care is expensive these days. But this insurance has a long waiting period. Ideally, you should take it as soon as you get married.

Health insurance riders

Riders are extra benefits that you can add to your base health plan. For these, you would bear an extra cost. There are many riders available on different types of health insurance plans. Some riders give you coverage even if you need medical care without hospitalisation. You can also get other riders like room rent waiver, personal accident cover, and hospital cash. Speak to your insurance provider before you buy a health plan. See how you can maximise the benefits.


You now know what health insurance is. You understand why it is mandatory for everyone. It helps you stay healthy and access the best possible healthcare. Health insurance policies also offer many tax benefits. Yes, this is another benefit of health insurance. But it should not be your only reason for getting medical insurance. Take a health plan to protect your health. The tax benefit will follow.