Individual or Family Floater Health Insurance: Which One is Your Preference?

There is no denying that health insurance has become an integral part of your financial portfolio. Your reasons for buying health insurance can be manifold, but you should have the clarity of whether you want individual health insurance or family floater health insurance.

Decoding both the policies!

While an individual policy covers the insured or all family members separately, a family floater policy covers all members under a single insurance policy. The sum insured is to be shared amongst the entire family members. In other words, the sum insured amount floats over the members like spouse, children and dependent parents.

Deciding between the Two

Insurance experts suggest a family floater plan for greater benefits. Floater health insurance is proved to be efficient in terms of their premiums, claim and renewal. Under a single premium and sum insured, you can cover your entire family. Thus, the premiums are comparatively lower than an individual plan.

Let’s say you have bought health insurance of Rs. 5 lakh to cover four members from XYZ Insurance Company . The annual premium for both the policies will be:

From the above table, it is noticeable that the premiums will be just double if you take separate individual plans for the entire family. Moreover, the post-sale service charges such as renewals and claim handling or other administrative expenses will be higher and renewal of separate policies will be tedious compared to renewing a single policy for all. Until and unless the entire family members don’t claim the sum insured in policy tenure, floater health insurance is always economical.

The other side of the coin!

No doubt family floater plans are economical and handy to continue with. However, you should not forget that the premiums may go up as the premium of a floater plan is considered based on the highest aged person of the family. Moreover, in case an elderly person has been suffering from an illness and requires frequent claims, it is better to opt for a separate individual plan to stay covered since the possibility of policy sum insured getting exhausted is higher. Or you can opt for a separate policy for the elderly person to restrict the exhaustion of sum insured.

Secondly, you also have to be careful while choosing the policy coverage, as it is often observed that the coverage taken under the floater policy does not seem enough for the entire family. For instance, you might take a lesser sum insured to pay a lower premium or assuming that not all the members will require to claim the policy at the same time. But a primary member of a family may require it often and sum insured may not be enough to suffice your needs.

What should be your call?

Whether buying an individual health insurance or a family floater plan is completely your call. However, if you have a family with kids or dependent parents, rather going for a separate plan for each, you should go for a family floater health insurance with a sufficient sum insured. The family with major health conditions or if one member has an adverse health problem, buying individual health insurance can be a good decision.