Market Update:
Flows: FII (Foreign Institutional Investors) have turned positive on Indian equities in the current FY and have invested Rs. 25 k crores in the month till date on the back of around Rs. 15 k crores each in March and April.
Major Event: All eyes will be on the US debt ceiling which is scheduled on 1st June, debt ceiling is a statutory limit set by the US Congress on the total amount of Debt the US treasury can issue to cover obligations of the US Government. If the ceiling limit is reached, the Treasury is unable to borrow to meet obligations which will lead to a potential default, which may result in serious implications and disruptions in the US economy. Japan, China and UK are the Top 3 holders of US Debt. If the ceiling limit is increased the markets would view it as a positive.
Regulatory update:
Income tax: The Rs. 2,000 Currency note will likely be withdrawn post 30th Sept 2023 and holders have been asked to deposit the Rs. 2000 denominated notes with the Banks. There was a clarification issued which mentioned that the notes will continue to be in circulation. TCS (Tax collected at source) of 20% would be charged on credit card payments in excess of Rs. 7 lakhs p.a. made outside the country and the total spend would form part of the LRS (Liberalised remittance scheme) limits of USD 250k per person. This will affect immediate cashflows, however the tax can be claimed back as a refund upon filing taxes. There were approx 1.8 crore Indians who travelled abroad from Jan to Nov 2022.
There were only 5.89 crore people who filed their taxes in FY 22 out of an adult population of people which represents about 6.89% of TAX FILERS.compared to nearly 45% Tax Payers in the US.
So, I urge you to at least file your returns, do get in touch with us, if you need any assistance.
This month we have listed out the essentials of a health policy which you may use to review your healthcare insurance plans and take stock of the major requirements of your health policy.
You may call us for the best plans available.
Important components of Health Insurance
As the proverb goes, "Health is Wealth", taking care of your health and the health of your family members is crucial. With the rising expenses of medical care and hospitalization, having health insurance is essential. Health insurance will serve as the safety net for you ensuring that you have access to quality health care and the necessary treatment by removing /reducing the dependency on your personal financial situation. It also acts as a financial safety net for the big, unexpected financial shocks that may arise due to rising medical costs, subject to the amount of coverage available.
We all are aware of the usual benefits and coverage of health insurance policies like hospitalization charges, pre & post-hospitalization expenses, day care treatments, Ayush and mental health care. However, it would be interesting to note that a health insurance policy may also offer several other benefits. There are plans available today that offer greater flexibility, more comprehensive features and coverage through add-ons and riders. Let's keep reading to explore some of these useful add-ons/riders that can be attached to your policy to help you gain more benefits from your health insurance plans.
1. Wellness benefit:
Some plans offer wellness benefits such as Regular/Preventive health check-ups and preventive healthcare services. These benefits encourage individuals to lead a healthy life and prevent the onset of any fatal diseases. Certain plans offer discounts on maintaining good health. For instance, if you walk 10,000 steps, you can avail of approximately a 10% discount on renewal premiums.
2. Non-Payable Items:
During a hospitalization, certain expenses are not covered by health insurance and need to be paid out of pocket. These are known as non-medical or non-payable expenses. The most common non-medical expenses are food, laundry, thermometer, bandages, nebuliser kit, toiletries, etc; These expenses can account for up to 10% of the total hospital bill that you have to pay from your pocket. By taking this add-on cover, such expenses can also be covered under your health insurance policy. So, you can expect the entire hospitalization claim to be paid without deduction.
3. OPD (Out-Patient Department /Treatment):
This feature provides coverage for medical expenses incurred on outpatient treatments, which do not require hospitalization or an overnight stay in a hospital. Depending on the policy, an OPD add-on can provide coverage for a range of expenses, including doctor consultations, diagnostic tests, pharmacy bills, and other outpatient medical expenses in such OPD cases too. An example of OPD is root canal treatment. Instead of being hospitalized, you can visit your dentist regularly for evaluation and treatment.
4. No claim bonus (NCB) and Cumulative Bonus (CB):
NCB and/or options CB add-on rider enables you to avail more coverage from your health insurance policy if you do not make any claims in the previous policy year. Companies now offer a 5% to 500% of progressive increase on the sum insured every year under such add-ons/policy features. For example, Rs. 5 lakh base sum insured can increase up to Rs. 20 lakhs in 4-5 years with no claim. Some plans give a cumulative bonus irrespective of claims. In such cases, the coverage increases every year even if you make a claim.
5. International benefit:
Some health insurance policies cover the medical expenses incurred during travelling abroad and while staying there. Under this benefit, you can plan for your treatment abroad (sometimes with the choice of your hospital), without worrying about the treatment costs. Such plans help you to upgrade your affordability to get the best treatments in the world. The global cover is available at a reasonable premium of around Rs. 1.5 -1.8 lakh for a family of 2 adults & 2 children with a sum insured of Rs 1 Crore.
6. Restoration benefits:
This add-on enables your health policy's sum insured to be restored up to 100% as soon as it is reduced following a claim. It is very useful in the event of a second hospitalization within a single policy year where you get to enjoy extra coverage. For instance, if you have a SI of Rs.5 lakh, due to a claim on the policy, the cover of 5 lakh is reduced, so on partial or complete utilization of Rs 5 lakh, this benefit restores another Rs.5 lakh for the subsequent claims.
7. Maternity Coverage:
Under this add-on, the policy covers the costs associated with the pregnancy (childbirth) up to the risk cover or a fixed amount. Both normal and C-section births are covered. Certain insurers offer pre and post-natal expenses and newly born baby coverage for a specific amount of maternity insurance. However the IRDA maximum limit for this cover is Rs. 50,000/-.
The Bottom Line:
With the rising cost of healthcare and medical emergencies in India, it has become increasingly difficult for people to pay medical bills, often compromising the quality of medical care received. Moreover, lifestyle-related medical conditions caused by factors such as sedentary life, poor diet, pollution, stress, and other external factors have become more prevalent. Fortunately, health insurance policies have evolved to meet the increasing demand for better and more comprehensive policies. Today, the policies not only cover hospitalization expenses but also offer many other covers and add-ons which can be customized. Additionally, health insurance policies in India offer a tax benefit that can be claimed under Section 80D of the Income Tax Act. While specific features may differ from one policy to another, one can evaluate the options available and select a suitable policy to match their needs.
