Health Insurance

Individual Health Insurance Vs Family Floater Health Insurance Plan

Nov 28, 2021

Individual Health Insurance vs Family Floater Health Insurance Plan

Getting health insurance has become a way of life now. No one can afford to live without health insurance. 

While some people buy small, basic health insurance plans, others invest in more elaborate and wide-ranging health covers. No matter what kind of health insurance you have, you need to have sufficient coverage to ensure you can take care of the expenses if there is a medical emergency. 

Depending on your needs and requirements, you can choose an individual health plan or a family floater health insurance plan. This is an important decision to make. 

Let us find out why you must choose with care and how these types of plans help you.

What is an individual health insurance plan? 

An individual health insurance plan, as the name suggests, is a health policy that only covers one person. All the covers and benefits available under this plan are solely available for the single insured person. 

The claim cannot be shared between the different members of the family. So for each family member to be covered under a health plan, you have to opt for individual health insurance for each member. The health insurance coverage for every member can either be the same or a different sum insured. 

What is a family floater health insurance plan? 

Under a family floater health insurance plan, multiple members of the same family can be covered in a single policy. All members receive the same health benefits and share common insurance coverage. The total sum insured is shared among the insured family members. If one of the family members file a claim for the whole cover, the other insured members may not be able to take the benefit of the plan in the same year.

However, a single premium is paid for the entire family floater cover. The biggest advantage of a family floater health insurance plan is that the different members of the family do not need to pay separate premiums for their health covers. Everything is controlled under one plan and it becomes more systematic and easy to manage the health cover.

Individual v/s family floater health plans- 

Take a look at the comparative table to understand the similarities and the differences between the two types of health insurance plans:

Point of ComparisonIndividual health planFamily floater health plan
Coverage Only one person, or an individual, is covered under such a health insurance policy. 
  • Different members of the same family are insured under a family insurance floater plan. 
  • While it is common to find only a couple of members are insured together, there are plans available in India that offer mediclaim covers for up to 19 members of the same family.
Premium 
  • The premium wholly and solely depends on the profile of the individual insured. 
  • If he is young and fit, the premium will be low. 
  • If he is older and has a few existing health conditions, the premium may be higher.
  • The premium is calculated on the basis of the oldest person insured in the family floater plan. 
  • Also, since there is a single premium for everyone, instances such as forgetting to pay a premium, etc are tackled more easily.
Scope of cover
  • Such a plan offers a wide range of covers including hospitalisation expenses, daycare procedures, domiciliary care, etc. 
  • You can also add riders to the individual health insurance plans as and when needed.
  • The family floater health insurance plans also have a wide range of coverage and cover in-patient care, ICU charges, etc. 
  • Riders are available under the family floater health insurance plans as well.
Discounts and benefitsAll the regular benefits such as the no-claim bonus are available under the individual health insurance policies.Regular discounts and benefits like the no-claim bonus are available under the family floater health insurance plans as well.
Maturity ageThere is no fixed maximum maturity age in most individual health insurance plans. 
  • In a family floater health insurance plan, usually, the maturity age is fixed at about 21 or 25 years for children. This means, when a child reaches the plan’s maturity age under the family floater plan, the dependent child would have to opt for another health insurance plan.



 

Most of the medical insurance plans from the leading health insurance companies are available on both, individual as well as family floater basis. You should choose the plan carefully depending upon what your requirements are. If you are a single person without any dependent family members, you will obviously benefit from an individual health insurance plan. If you are a family person with dependents, a family floater plan would be best suited for you and your loved ones.

Individual and Family Floater Health Insurance Plans- How do they work?

When you buy a health insurance plan, you need to pick your coverage amount, i.e. your sum insured. This amount is a representation of the maximum amount that would be paid out to you in case of a claim. 

For example, if you have a health plan worth INR 5 lakhs and if you are hospitalised due to an illness and your hospital bill is INR 1.5 lakhs. Then this amount would be covered by your insurance company. The remaining INR 3.5 lakhs would be unutilised and can be further used for any other expenses on hospitalisation. This is basically how health insurance works. Now let us see the details involved in the 2 kinds of health plans. 

As discussed above, an individual health plan is for an individual. It does not cover your family members under a single sum insured, each member has a separate sum insured that is evaluated on an individual basis. 

On the other hand, in the case of a family floater plan, the whole family is covered under one plan. The family floater plan is effectively cheaper than opting for individual covers for all members, but the coverage is also shared.

 

Let us take the example of the Religare Care Plan on both individual and family floater basis to explain this.

 

Rahul35 years old, male
Spouse- Rachna30 years old, female
Health insurance plan coverageINR 10 lakhs

Case 1: So, if Rahul opts for individual plans for both himself and his spouse, the premiums would be 

The premium for an individual plan for RahulINR 9546
The premium for an individual plan for RachnaINR 9546

Case 2: If Rahul opts for a family floater plan for himself and his wife, the premium would be

The premium for a family floater option with both Rahul and RachnaINR 14,362

So, a family floater health plan would cost about 20% less than the sum of both the individual health plans.

Let us understand how these plans work with the help of the following examples:

How Individual Health Insurance Works?

Rahul is a software engineer. He is 35 years old and his wife Rachna is 30. Rahul has an Individual health insurance plan. His wife also had a separate health insurance plan for herself and so did his 58-year-old mother. The sum insured of each plan is INR 5 lakhs. 

 

Last month, the three of them were travelling in their car when it was hit by a truck. The three of them were injured and were admitted to a hospital. Rahul’s mother was hospitalized for 2 days, she had a hospital bill of INR 75,000. Rachna was in the hospital for 3 days and got a bill of INR 2 lakhs. Rahul was hurt badly and required two surgeries. His medical bill was INR 6.5 lakhs.

 

Since each of them had individual health plans of INR 5 lakhs, the expenses incurred for Rahul’s mother and Rachna were well within the limit. Thus, the entire payable amount of the claim was admitted for their claims. However, in Rahul’s case, as his medical bill crossed his sum insured, he had to pay the remaining INR 1.5 lakhs from his pocket.

How Family Floater Health Insurance Works?

 

Now let us imagine the same scenario, with the difference that Rahul had a family health insurance policy, with a sum insured of INR 15 lakhs. After the accident, their total bill would have been INR 9.25 lakhs. And thus, even after paying for the treatment of all three members, they still had some unutilised sum insured amount in their health plan. 

The final word

You should choose the best health insurance policy and stay covered in the most wholesome and comprehensive manner. Compare the available options and then choose the best plan. Pay your premiums on time and keep yourself as well as your loved ones protected in the most well-rounded manner. 

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