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Health insurance is an insurance product that covers medical expenses incurred by an individual.

It is an agreement between the insurer and the individual or group of people in which the insurer agrees to provide sufficient health coverage at a premium to the individual or group of people.

Why is Health Insurance important?

With the cost of medical expenses and hospitalisation skyrocketing, it has become important to get covered under Health Hnsurance.

It helps in meeting the sudden expenses of emergency hospitalisation of self or any member of the family.

It protects from sudden, unexpected costs of hospitalisation or other covered health events like critical illnesses, which otherwise may dent the household savings even leading to indebtedness.

Medical emergency can strike anyone without prior warning and with healthcare becoming increasingly expensive, it is very important to opt for medical coverage and buy policies which will cover the entire family too.

Sometimes high treatment expenses may be beyond the reach of many, so opting for Health Insurance is the best thing to do.

What does a health policy cover?

A health policy covers pre- and post-hospitalisation expenses.

In addition to hospitalisation, some specific policies offer number of additional benefits like maternity and newborn coverage, day care procedures for specific procedures, pre- and post-hospitalisation care, and other benefits.

A critical illness plan provides a fixed amount to the insured in case of diagnosis of a specified illness or on undergoing a specified procedure.

What are the tax benefits for Health Insurance?

There are various benefits provided to the policy holder under Section 80D of the Income Tax Act.

This section of the Income Tax Act is different from Section 80C which is applicable to life insurance wherein other forms of investments/expenditure also qualify for the deduction.

If a taxpayer buys a Health Insurance policy, then under Section 80D deduction is available up to Rs 25,000 for insurance of self, spouse and dependent children.

If the individual or spouse happens to be more than 60 years of old, the deduction available is Rs 30,000.

Additional deduction for insurance of parents (either or both parents) available is up to the extent of Rs 25,000 if they are less than 60 year old and Rs 30,000 if they are more than 60 year old.

For super senior citizens (more than 80 years old) who are uninsured, medical expenditure incurred up to Rs 30,000 shall be allowed as a deduction under Section 80D.

Therefore, the maximum deduction available under this section is to the extent of Rs 60,000.

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