The CSO and Citigroup Analysis 2008 indicate that medical expenses in the country have nearly doubled since 2001. Rising healthcare expenses encourage individuals to buy Indian health insurance.
An insurance industry survey in 2008 points out that only 3% of the total Indian population enjoys coverage under healthcare policies. This small number constitutes both public-funded and private medical insurance. So, there is an urgent need to energize the health insurance sector. This would also help to avert financial expenses on medical treatment.
In India, public funded healthcare is available only to a small section of low income group people and to government employees only. The Employee State Insurance Scheme (ESIS) focuses on the public healthcare policy for low income groups. The Central Government Health Scheme (CGHS) offers medical treatment to government employees. However, people can opt for free medical treatment which is offered by any of the government-run hospitals and dispensaries.
In the private domain, three types of Indian health insurance policies are available. These are grouped as follows:
Most Indians are privately insured, which usually means that they opt for a group medical insurance policy, which is known as Medicare. These policies are partially or wholly funded by the employer. Group medical insurance offers several benefits over cover, premium, claims and reimbursement. Only a limited high income group has access to individual medical insurance.
In terms of cover, a private insurance policy may be divided to cover specific segments. These include segments such as basic hospitalization cover, critical illness and daily medical treatment reimbursement. Based on individual requirements, it is possible to select a cost-effective healthcare policy that comes with reasonable cover.
The Indian government allows for tax deductions to promote the private healthcare system. An individual can get tax benefits up to Rs.15, 000/- as premium paid to the Indian medical insurance policy. Complete tax waiver is also available for those who buy Indian medical insurance for senior citizens.
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