Due to the recent worldwide outbreak of coronavirus, governments around the world including India have imposed a lockdown on its people. Everyone is at home and is finding something to keep them engage during this pandemic. If you are a young adult who has just started earning, you can buy health insurance. 

First of all, these are unprecedented times, and having medical insurance will surely help you financially. The coverage provides by the insurance policy will take care of you and your loved one’s medical expenses and hospitalization bills in the time of need. Not only this, it will also provide your tax benefit under section 80D of Income Tax Act, 1961. 

It is advisable to buy a health insurance policy at a young age, as you have to pay much less premium. It is because the chances of you attaining a long-term illness are less at a young age, hence low premium rates. There are several advantages of opting for it at a young age. But medical insurance consists of two types of plans, Indemnity Plans, and Fixed Benefit Plans. Let’s see the difference: 

Indemnity-based health plans indemnify the policyholder against medical and hospitalization expenses up to the total sum insured. Under this plan, you will get reimbursed for the actual expenditure incurred during hospitalization only up to the total sum insured under the Indemnity plan. If you have opted for the cashless hospitalization plan, you only need to pay a certain fixed amount and the rest will be taken care of by your insurer. However, if you have not opted for the cashless hospitalization plan, you need to submit the necessary documentation such as bills paid, medical reports, and other required documents, so that your insurer can reimburse the expenses.

You should know that the plan will only reimburse the money that is spent on the treatment within the limits of the sum insured. Family Floater Plans or the regular Individual Health Plans come under indemnity plans.

If you opt for a fixed benefit health plan, you will get a fixed and guaranteed amount equivalent to the sum insured in case of an insured event as per the policy terms and conditions. In this plan, you will get a lump sum amount as a claim irrespective of the intended or actual expenses incurred during hospitalization. Fixed benefit plans and indemnity plans are different from each other. It is up to you how you want to use the claim amount.

The main concept of investing your hard-earned money in health insurance plans is to get appropriate coverage. It is very important to maintain a balance between Indemnity Plan and Fixed Benefit Plan if you want a comprehensive health insurance cover. Both of these plans come with specific advantages, it is up to you to choose them as per your specific medical needs. For the millennials, both plans are good, but you have to choose based on your and your family’s medical needs.