This is a question that is very very difficult to handle!

When an agent comes to you he suggests you to take about Rs. 5L of medical insurance – normally. I know of agents who suggest Rs. 3 lakhs of a stand alone policy and a Rs. 5 lakhs floater for the family. Thus the head of the family, theoretically, has about Rs. 8L of medical insurance.

You can also take a ‘top-up’ medical insurance – this comes into play after the first part of the medical insurance has played its role.

Thus if you have a Rs. 3 lakh primary insurance and a Rs. 10L worth of ‘top-up’ insurance, you need not worry if you have claims upto Rs. 13L.

However there is a catch in the top up. If you have one claim of Rs. 8L and after some time you have another claim of Rs. 8L you WILL not get paid by the top up part of the insurance.

The worry is the kind of bills that you CAN run up today.  A neighbor recently ran up a bill of Rs. 67 lakhs – and spent one month in coma. Luckily his company picked up the tab and his insurance was not called into play. Surely his company was big (huge) and so the bill was paid for by the company.

Imagine what would have happened to a normal person – such a big amount of money could have come only from a loan or selling off of major assets.

What should you do?

Hope and pray that you do not have to pay for a fire accident (Rs. 20L is a minimum kinda bill),  being in Coma can cost you Rs. 55 lakhs for a month. Heart related medicines can cost in excess of Rs. 5-6L a day. ..

really there is no limit to what you may end up paying as expenses…insuring is kind of tough, very tough.

Start a SIP in a balanced fund with a high amount of equity ….maybe with a small amount like Rs. 1000 pm…apart from insuring your self. Slowly increase the SIP amount by about 20% EVERY year…..

As long as this portfolio is earning more than 7% p.a. remember you are building a nice steady sum for your medical emergencies. …..

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  1. Thanks for highlighting this.

    As I’m also hearing about more such cases, have started suggesting clients on similar lines.

    If older people / senior citizens go for cover, the premium some times even become 18% of the cover.

    Does it make sense to go for a premium if it is more than 10% of the cover? I’m just throwing 10% as a number. The idea is that beyond a particular cost, it may be better to bear the risk than transfer the risk.

    Like general contingency fund, medical emergency fund is becoming part of an individual’s plan- irrespective of cover he has. Also some exercise for 30 minutes a day is also becoming part of the financial plan!

  2. Most people think having a policy with cashless option is enough for all hospitalization needs. Nothing could be far from the truth. Cashless may not always be granted. It also depends on where you get hospitalized. Best to have at least 50% of mediclaim cover as part of ones emergency fund and constantly contribute to it.

    Also there are many expenses which one will have to pay for even if cashless is activated.

    Medical inflation is a bizarre 15-20%.

  3. Is there any trusted website which gives an approximate cost of ailments in a nice chart format and updates it regularly?

    Medical research should have cost as a optimizing criteria too. It must recognize that it is better to say ‘wait for death’ than saying ‘there is a treatment at X Rs’. How to do this communication is a tricky job though.

  4. Very true. If it is not too much trouble, can you post which company your neighbor is working? Not planning to get sick, but surely nice to know that someone would take care of financial aspects in medical emergencies.

  5. ‘Medical research should have cost as a optimizing criteria too. It must recognize that it is better to say ‘wait for death’ than saying ‘there is a treatment at X Rs’. How to do this communication is a tricky job though.’
    it reminded me a book by Dr. Manu Kothari (a well known doctor of Mumbai Hospital) in Gujarati ‘ GHADPAN, ROG, ANE MRUTYU ‘ on old age, disease , in which , he stated with data that old age diseases (related to internals of our body, not by viruses , bacteria, accident etc, eg. cancer, diabetes, heart attack etc) do not cause of death. they(diseases) are from the birth with the body, and can not be cured with any treatment. they are virtue of the body, whereas death is virtue of time, and decided from the birth itself. so do not overdo with them (diseases). just cure them for reducing the pain , if any. as per him, at time of death , the person has no pain (may be due to some enzymes at the time).
    i think, i can’t described exactly what dr. manu kothari says ,but i understand as above. so relax ,and hope for the best with what we can do with our limited means and planning.

  6. Very eye opening article. Everyone should be aware of the facts irrespective of the field he’s working and the amount which he’s insured by the company

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