I bought LIC Health Protection Plus mediclaim policy in March 2010 for myself and my wife with an annual premium of Rs 15,000. Our 1-year-old daughter isn't covered under it yet. Additionally, my employer provides group insurance coverage of 4 lakh for all three of us. Please suggest if I should continue with my current policy or consider other options?
LIC Health Protection Plus plan is a unit linked health insurance policy. In this plan, premium is divided into 2 parts - one part is utilized to provide health protection and the other part is invested in market linked funds. But it tends to be expensive. For the same premium amount that you pay for this policy, you can get a pure health cover of up to Rs 8-10 lakh for your family. Unfortunately, this policy does not have a surrender option and hence you can either continue the policy or just let the policy lapse and bear the loss. We advise you to choose the latter.
Your existing health cover provided by your employer will serve you only as long you are working with the same company. Therefore, its advisable to have a separate basic health family floater policy which covers your entire family.
Alternatively, since you have a base cover provided by the employer, you can consider buying a Super Top Up policy which will be more cost effective. Apollo Munich Easy Health and ICICI Lombard Complete Health Insurance policy are recommended.
A Super Top Up policy, as the name suggests, is an add-on cover that will come into action once the claim amount exceeds a base amount (deductible, in insurance lingo). Keep the deductible limit equal to the cover provided by your employer, which is Rs 4 lakh in your case. Now if you buy an super top-up of Rs 5 lakh, the total health coverage of your family will be Rs 9 lakh. The employer's health cover will take care of expenses up to Rs 4 lakh and the super top up will take care of expenses above that amount.
Now how much coverage is adequate depends upon a lot of factors such as your lifestyle, your medical status, family history of medical condition, etc.