One out of every four Indians is at risk of dying from a non-communicable lifestyle disease, such as diabetes, cardio-vascular ailments or cancer, before the age of 70. To add to this, health costs in India are soaring.

The way out: make sure you sign up for a health insurance plan that takes care of rising health costs and sudden emergencies.

Here are five essential tips to keep in mind while buying health insurance.

Identify your need
Health risks and insurance needs differ depending on age, area of residence, gender, family history of illness, work life, family life and diet. For instance, individuals who spend long hours at a desk job without getting enough exercise, run the risk of developing obesity.

On the other hand, someone who lives in a polluted metropolitan city can contract respiratory ailments. Based on the specific health risks, individuals must decide the type and extent of the cover they need.

Find your perfect match
Insurance companies in India offer a variety of health plans. These range from individual health to family floater plans. You can now evaluate the plan of your choice online by comparing plans of various providers.

When signing up for a policy, ensure that it offers a no-claim bonus. This way, individuals who haven’t used the insured amount in a particular year will receive a percentage addition in the sum insured at the same premium the next year.

Buy the right policy
It is wise to buy insurance from a reputed insurer. Choose companies that have good claims settlement history. Ensure that the insurance intermediary or broker holds a valid licence.

Know sub-limits
Sub-limits often require the policy-holder to fund the balance hospital payment once the company has paid its part.

For instance, if the sub-limit on the hospital room rent is 1 per cent of the sum insured, then, in case of a policy with sum insured ₹5 lakh, the company will pay only ₹5,000 per day for room rent.

If you have selected a deluxe suite, where the room rent is more than ₹5,000, then the remaining amount will have to be paid from your pocket. In cases where the individual needs a high medical insurance cover but doesn’t have the necessary means to fund it, it is advisable to invest in a top-up plan.

A top-up plan acts as a buffer if the existing cover is exhausted due to any unforeseen illness.

Account for medical inflation
If you take a policy at 25, you are likely to make a claim 10-15 years later. It is thus vital to estimate what the hospital costs will be at that point in time.

The writer is Managing Director and CEO, SBI General Insurance

Bhaskar Jyoti Sarma
This article was published on November 22, 2015, in BusinessLine (The Hindu)