The requirement for a lump-sum payment to get a health insurance policy was proving to be a significant barrier to the expansion of health insurance penetration in India as people’s knowledge of the importance of health insurance continued to grow. However, the Insurance Regulatory Development Authority of India (IRDAI) chose to reduce the financial burden and increase the flexibility of premium payments.
Therefore, in 2019 the Insurance Regulatory and Development Authority of India (IRDAI) instructed health insurance providers to give policyholders the option of paying annual health insurance premiums on EMIs. This was done to boost the affordability of health insurance for Indians. As a result, it is possible to pay for health insurance coverage with a predetermined sum in quarterly, monthly, and biannual payments.
With the availability of health insurance on EMI, what would have previously felt like a financial burden for those who had to pay the price all at once, has now become convenient.
Benefits of Choosing Health Insurance Policy on EMI
Here is the list of the benefits of buying a health insurance policy on EMI.
- Increasing Health-Related Problems:
The increased sedentary character of the modern lifestyle creates the perfect environment for many lifestyle-related disorders. Reduced physical activity among the working class is a major contributor to serious illnesses like heart disease, diabetes, many types of cancer, and even organ failure.
The most secure strategy to safeguard the future of your family is to purchase family health insurance. However, not everyone can afford the high insurance premium costs. A bigger group of people thus benefits from the ability to divide the premium into smaller quantities in the form of health insurance on EMI.
- Greater Convenience
For many people who depend on a monthly income, the option to pay health insurance payments in the form of EMIs makes it more convenient. It is also hassle-free because of how simple it is to make payments online. These two characteristics have also aided in enhancing rural residents’ access to health insurance.
- Flexible Payment Option
With flexible premium payments through EMIs on a monthly, quarterly, or half-yearly basis, it is now able to choose a substantial health insurance cover to suit your medical needs as well as those of your family. You no longer have to sacrifice the quality of the treatment because you are afraid of having to pay a high single premium to receive extra coverage.
- Protect Yourself and Your Family
Because a health emergency never comes with any warning, the person may end up facing financial hardship. However, now that you may pay the premium on a monthly or quarterly basis, you can protect your entire family without having to worry about paying a huge sum upfront.
- Beneficial for Senior Citizens
Seniors pay greater premiums for their health insurance because they are more susceptible to health hazards. Additionally, seniors might also have a limited monthly income. As a result, they can now take advantage of necessary health insurance coverage and receive medical care without having to worry about managing their funds- thanks to the availability of health insurance on EMI.
- Get Tax Benefits
According to Section 80D of the Income Tax Act, one is still entitled to tax benefits even if they pay their health insurance premiums through EMIs. They are eligible to deduct insurance premiums from their taxable income.
Why Was The Provision For Health Insurance On EMI Introduced By The IRDAI?
The lack of sufficient finances in people’s accounts to cover the one-time payment or health insurance plans is the main cause of the poor penetration of health insurance in India. People might view health insurance as a crucial financial product rather than a financial burden because they can choose the frequency of their monthly payments.
It has been predicted that the availability of health insurance on monthly EMI will signal increasing health insurance penetration in the nation and boost the viability of health insurance. You still have the option of purchasing your health insurance plan in one lump sum.
You may also choose to purchase health insurance on an EMI plan if you don’t have enough money for the purpose or if you prefer to stretch out your health insurance costs more evenly. Therefore, the frequency of premium payments is entirely up to you, the policyholder.
How to Choose the Right Health Insurance Policy on EMI?
Choosing a health insurance plan might be challenging because there are so many options available that offer EMIs. There are a few things to watch out for, like:
- Look for health insurance with no cost EMI, which means there are no extra expenses over and above the annual payment.
- Make sure the policy offers coverage for both the number of people your health insurance policy is intended to cover as well as your healthcare demands.
- Read the terms and conditions of your health insurance policy to see what is excluded.
- Make sure the insurer offers cashless hospitalisation and has a solid reputation for providing excellent customer service.
All Indian policyholders have applauded the new rule allowing for the payment of health insurance policies via EMI. Due to the price of this alternative, health insurance is now easily accessible even to those with lesser incomes. As a result, since the launch of the plan, there has been a significant increase in the number of people purchasing health insurance policies in India.