The Best Health Insurance Strategy For Seniors
Published by Outlook Money
Abhishek Kumar's role: Quoted
Abhishek Kumar suggested that seniors keep a medical fund in two pools, one for claim shortfalls and one for long-term caregiving. He put the total at ₹10 lakh to ₹18 lakh for a metro couple, held in options such as SCSS or liquid funds.
What Abhishek Kumar said
How should senior citizens set up a medical emergency fund alongside health insurance?
I recommend building it as two separate pools. The first is meant to meet any shortfall when a health insurance claim is settled, such as consumables and other items the insurer deducts or does not reimburse, and this pool can sit in sweep-in fixed deposits. The second pool is set aside for caregiving needs over the long term.
How big should a medical fund be for a senior couple living in a metro?
For a senior citizen couple in a metro city, I suggest a fund of at least ₹10 lakh to ₹18 lakh. Of this, around ₹3 lakh to ₹4 lakh can be kept for covering shortfalls when the insurer settles a claim, and the remaining ₹7 lakh to ₹14 lakh as a reserve for caregiving over the long term. A useful rule of thumb is that this reserve should be large enough to pay for at least 12 to 24 months of full-time caregiving.
Where should seniors keep their medical emergency money?
I suggest keeping the medical fund in options that pay out a steady income periodically, like the government's Senior Citizens' Savings Scheme, or else in liquid funds, which you can get at quickly in an emergency. Which of these suits each part of the fund depends on what that money is for and how soon you might need it.
In our words, from what he said in the piece. General information, not personal advice.
More of Abhishek's views on insurance
This magazine feature looks at why health insurance gets costly and restrictive after 60. It covers rising premiums, pre-existing conditions, co-payments, deductibles, super top-ups, exclusions and mis-selling. It also suggests ways to balance cover and cost, and building a separate medical fund beside the policy.
Publisher source
The Best Health Insurance Strategy For Seniors