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Individual Mediclaim policy or Family Floater – which one should you buy?
Individual Mediclaim policy or Family Floater – which one should you buy?
Jun 22, 2015 | 3346 VIEWS
Health insurance policies are gaining momentum in terms of sale because nobody wants to be caught in a financial crisis when a medical emergency arises. Even insurers are coming up with new and improved versions of the plans launched by them making necessary changes to make them more appealing. With a host of plans on the platter, a common man is spoiled for choice. Health plans come in 2 versions – Individual Mediclaim and Family Floater ones. Individual mediclaim plans insure one person against medical contingencies faced by him/her. Family Floater plans on the other hand insure the husband, wife, kids and sometimes even dependent parents under a single Sum Assured with a single premium. The choice to go with either the Individual plans or family floater ones is debatable and unless you are aware of the pros and cons of both the versions, reaching a prudent decision is difficult. This article comes to your rescue as we intend to outline the benefits of each over the other through the following points:

1. Premium – the premium of insuring your spouse and children under an Individual plan is obviously higher than that under a Family Floater one.

2. Coverage for dependent parents and children– generally most of the family floater plans barring a few exclude dependent parents from the scope of coverage. Thus in such a situation, buying a family floater defeats the purpose since your parents will need most of the medical attention due to age. Moreover, the policies that do cover parents are expensive since premium is calculated on the age of the senior-most member which in that case will be the dependent parent.  Furthermore, dependent children are covered till a specified age which is either 21 or 25 depending on the plan. After the children reach that age, they are excluded from the cover.

3. Renewability – after a change in regulations, almost all policies are now renewable lifelong. However, this rule does not apply to family floater policies which are terminated after the senior-most member reaches a certain age like 60 or 65. In that case, buying an individual plan for all members separately will become quite expensive. Moreover, the family’s claim history will also be ignored under the new policy and the pre-existing clause will apply afresh.

4. Limit on Sum Assured – under a family floater plan, every member shares the same Sum Assured. In the event of a medical emergency, if one member is hospitalized and uses up the entire amount, the other members cannot make another claim within the same year. Thus the scope of the plan is limited. 

5. One plan for all – the family floater plan is universal in nature providing a uniform scope of coverage to all members. There is no scope for customization which makes it rigid in nature.

Conclusion
Though the Family Floater policy is cheaper than the Individual one, it is quite rigid and provides a limited scope. Under certain contingencies, the family floater plan may fall short of requirements and as such, it is always better to buy an Individual Policy for every member despite a bit of a high premium. Family floater proves good if the family is young, i.e. the age of the father is about 30-35 years and for a couple without kids or with young kids. For them, the floater option would be optimum. But in other cases, an Individual Policy would prove exhaustive providing customized coverage.

Manoj Aswani
Manoj is the co-founder and COO of MyInsuranceClub. He has experience in Financial Services, Internet, Insurance and Outsourcing business. He has done his Post Graduation from XLRI, Jamshedpur.

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