Health insurance policies are an essential tool for individuals and families to cover medical expenses. It is crucial to select a policy that meets your needs, as there are different types of policies available. One type of policy that has gained popularity in recent years is the “floater” policy. In this article, we will discuss what floater premium is and how it works.
What is a Floater Policy?
A floater policy, also known as a family floater policy, is a type of health insurance policy that covers multiple members of a family under a single policy. Under a floater policy, the sum assured or coverage amount is shared among all the members covered under the policy. This means that each member does not have a separate sum assured; instead, the overall sum assured applies to everyone covered under the policy.
For instance, if a couple and their child are covered under a family floater policy with a sum assured of Rs. 5 lakhs, then the entire sum assured of Rs. 5 lakhs can be used by any of the three members during the policy term. This means that if the child requires medical treatment that costs Rs. 2 lakhs, the parents can use the remaining Rs. 3 lakhs for their own medical expenses.
What is a Floater Premium?
A floater premium is the amount that an individual or family pays to purchase a floater policy. The premium is calculated based on several factors, including the age of the individuals covered, their medical history, the sum assured selected, and the duration of the policy.
The cost of a floater policy is generally lower than buying individual policies for each family member. This is because the insurer’s risk is spread out over multiple members, allowing them to offer a discounted rate. Additionally, a floater policy eliminates the need for separate policies for each family member, making managing the policy simpler and more convenient.
Factors Affecting Floater Premium
Several factors can impact the cost of a floater premium. These include:
Age: The age of the eldest member covered under the policy is a crucial factor in determining the premium. Generally, the older the person, the higher the premium will be, as they are considered to be at a higher risk of developing health problems.
Medical History: The medical history of the individuals covered under the policy is another critical factor that impacts the premium. If any member has a pre-existing medical condition or a history of chronic illnesses, the premium may be higher.
Sum Assured: The sum assured selected for the policy is also a significant factor in determining the premium. A higher sum assured will result in a higher premium.
Duration of Policy: The duration of the policy is also a crucial factor in determining the premium. Longer-term policies typically have lower premiums than short-term policies.
Features and Benefits of Floater Policies
Floater policies offer several features and benefits that make them an attractive option for families. Some of these include:
Single Policy for the Entire Family: One policy covering all family members makes managing the policy easier and more convenient.
Lower Premiums: As mentioned earlier, the cost of a floater policy is generally lower than buying individual policies for each family member.
Higher Coverage: Floater policies typically offer higher coverage amounts than individual policies, allowing families to access better medical care if required.
No Claim Bonus: Some insurers offer a no-claim bonus, which means that if there are no claims made during the policy term, the insurer will provide a discount on the premium when renewing the policy.
How to Choose the Right Floater Policy?
When selecting a floater policy, it is essential to consider the following factors:
Coverage Amount: Determine the amount of coverage needed based on your family’s medical history and current health status.
Premiums: Compare the premiums of different policies to find one that offers the best value for your money.
Co-payments and Deductibles: Review the co-payment and deductible requirements of the policy to understand how much you will be responsible for paying out-of-pocket.
Network Hospitals: Check the list of network hospitals covered under the policy to ensure that there are hospitals near your residence or workplace.
Conclusion
A floater policy is a type of health insurance policy that covers multiple members of a family under a single policy. It offers several benefits, including lower premiums, higher coverage amounts, and convenience. When selecting a floater policy, it is essential to consider factors such as the coverage amount, premiums, co-payments, deductibles, and network hospitals. By taking these factors into account, families can select a policy that meets their needs and provides financial protection in case of any medical emergencies.
