What is Health Insurance Deductible?

A health insurance deductible is the amount that the individual must pay from his/her pocket before the insurer pays for the medical expenses from the policy coverage. When the insurance policy has a deductible clause, the individual is required to pay the deductible amount towards medical expenses, followed by which the policy pays the remaining.

Example: If the total medical expenses are INR 30,000 and the deductible is INR 10,000, then the individual is required to pay INR 10,000, and the coverage pays the remaining amount of INR 20,000. It is important to note that if the medical expense is less than the deductible, then the insurance company does not pay anything towards the medical expense and the individual must bear the entire cost.

There are different types of deductibles: Comprehensive, Non-comprehensive and Cumulative. While the Comprehensive Deductible is the most common and can be used in the case of all types of coverage, the Non-Comprehensive Deductible comes into play only for certain types of coverage or medical costs. The Comprehensive Deductible is often used in a family floater health insurance policy, wherein every insured individual’s contribution is considered toward the family’s maximum deductible as a whole.

It is important to remember that different insurance plans have different deductibles. There are also insurance plans available without a deductible component. It is the choice of the individual to decide the right plan based on his/her financial capability.

The presence of a deductible allows the individual to take care of a percentage of the medical expenses out of his/her own pocket, and therefore, the premium associated with such a policy is low. If you are sure that you can meet the deductible in the event of hospitalization, then you should opt for an insurance plan with a deductible. However, if you are unsure about your future financial position, and would prefer a plan that provides full coverage, then it would be better to invest in a plan with a fixed premium so that it can cover any and all situations that may arise in the future.