What is Health Insurance: Benefits and Features


Health insurance policies are designed to cover the cost of medical and surgery expenses. Taking out health insurance gives you financial support when facing a medical emergency or needing to cover healthcare costs. The benefits of health insurance plans for Bangladeshi citizens include coverage for medical expenses such as hospitalization, medication, and doctor or physician costs. However, there are currently only less than 10% life insurance policyholders are under health coverage in Bangladesh.

What is Health Insurance?

Defining Health Insurance

Health insurance plan is a type of coverage for medical-related expenses incurred by the insured. These costs are covered directly by the insurance company, or the insured pays out-of-pocket and claims back from the insurer. Depending on the policy terms, the insurer pays out for all or some of your healthcare costs. The insured pays a monthly premium for this plan.

Why do We Need Health Insurance?

Healthcare cost can put an enormous financial strain on a family. This becomes even more of a problem when personal savings aren’t sufficient to cover medical emergencies. The aged, who face more health problems in their later years, will find this situation difficult to manage as they may have to utilize their savings to finance rising healthcare costs.

Taking out a health policy gives you peace of mind when dealing with a health-related crisis. This type of insurance plan offers disease cover as well as coverage for surgical procedures. Most related medical expenses are paid out and the policy continues even after benefits have been covered. You can rest assured your family’s financial and health well-being are protected with this type of plan.

How Health Insurance Works

Health insurance in Bangladesh can be provided by an insurance company.  private enterprise. Coverage and pricing vary depending on the type of plan you purchase and the insurance company you deal with. Corporates may include health insurance for their employees with the premiums partially paid for by the employer. Otherwise, an individual may get their own medical insurance.

Medical insurance in Bangladesh can either be offered as standalone health policies or include healthcare coverage in life plans. Different products could include coverage for several critical illnesses while riders give you financial security in the event of needing hospitalization due to an accident or illness.

When you approach an insurer for health insurance, you’ll need to supply details such as your age and medical background. In some instances, you may need to undergo medical tests before an insurer agrees to certain benefits. When you’ve decided on the type of plan and sum insured required, the insurance company will inform you the features of health insurance and send you premium quotes.

Agreeing to the terms and conditions is a prerequisite before purchasing a policy. Some plans come with waiting periods which means you can’t submit any non-emergency claims during that time. If you get treatment from a network hospital, the insurer will settle all bills directly. Otherwise, you make the payments and submit a claim to the insurance company for reimbursement.

What Does Health Insurance Cover?

Depending on the type of health insurance coverage you purchase, there are different coverage options. Critical illness insurance protection plans are designed to cover the costs of medical treatment associated with these conditions. When taking out a critical illness insurance plan, take note of how many conditions it covers and which ones.

Coverage could also include loss of income benefits and death coverage. Specific riders such as hospital care, Medicare, critical care cover expenses associated with hospitalization whether it’s due to an illness or accident.

Who Needs Health Insurance Plans?

If you’re responsible for the financial well-being of your family, you should need to have  a health insurance to protect yourself during a medical crisis. This type of coverage means you can give your family proper healthcare no matter the circumstances.

Health insurance policies give you immediate financial help in the event of you and your loved ones succumbing to a critical illness or needing treatment in a hospital. People of all ages need health policies to protect them from the financial burden of paying for costly medical bills. It becomes even more important for retired individuals whose income has ceased.

Anyone who has to undergo a surgical procedure should have needs a health insurance plan to cover the associated expenses. Death coverage due to covered or non-covered illnesses is paid out to beneficiaries, giving you peace of mind that your family is financially protected.

Categories of Health Insurance Plans

Two types of health policies are available – indemnity and defined-benefit plans.

Indemnity Plans

Indemnity plans are traditional health insurance policies designed to cover healthcare expenses equivalent to the sum insured. These plans include:

-          Individual insurance

-          Family floater insurance

-          Group insurance

Defined-Benefit Plans

Definite-benefit plans offer a lump sum compensation when the insured is diagnosed with an illness. These plans include:

-          Critical illness protection plans

-          Hospital care plans

-          Critical care plans

Types of Health Insurance Plans

There are different plans specifically designed for the individual, senior citizens, family, and group cover and their unique needs.

Individual Health Insurance

Individual health plans can be purchased for yourself, your spouse, your children, or your parents.

Features of Individual Health Insurance

Each insured member has their own sum insured amount to cover medical and healthcare expenses. The coverage amount is based on the premiums paid and the sum insured.  This plan covers you throughout your life if you renew and pay your premiums timeously. Individual health insurances plans can be purchased for protection against dread diseases.

Benefits of Individual Health Insurance

This type of policy is comprehensive, covering all types of medical expenses including:

-          Hospital care

-          Hospitalization and pre-and post-hospital treatments

-          Preventative care

-          Nursing, surgical procedures, hospital room renting, and medical practitioners.

-          Medication

This type of health insurance policy is beneficial for single people looking for optimal healthcare protection.

Family Floater Health Insurance

Family floater health insurance is tailored to include coverage for both the insured and extended family members. It shares similar features to the individual plan but acts as an umbrella for the whole family.

Features of Family Floater Health insurance

The family floater health insurance plan is a single policy with every member sharing the sum insured amount. It’s a more affordable option compared to individual health insurance plans and the total sum insured can be shared or used on one family member who is unwell.

Benefits of Family Floater Health insurance

The benefits of this insurance plan include coverage of the following:

-          Health check-ups

-          Hospitalization and pre-and post-hospital treatments

-          Medical practitioners, specialists, and surgeons consulting fees

-          Medicare

Having a single health insurance plan for the whole family makes it easier to submit and track claims and payments. Family floater health policies offer an affordable healthcare protection plan for young families, and they can include riders for extra coverage.

Senior Citizens Health Insurance

Senior citizens’ health insurance is specifically designed to take in the unique healthcare needs of the aged, giving them additional financial support for medical expenses.

Features of Senior Citizens Health Insurance

Features include covering age-related illnesses common in the aged population. Senior citizens can rest assure as they receive medical attention as soon as they need it if they have health insurance plan. The entry age is higher for this type of plan making it accessible for those in their later years.

Benefits of Senior Citizens Health Insurance

Senior citizens purchasing this type of policy can get the following benefits:

-          Preventative check-ups

-          Hospitalization as well as pre-and post-hospital treatment coverage

-          Day-care procedure cover

-          Medicare

-          Reduced co-payment terms

Depending on the terms and conditions of the senior citizen medical insurance plan, there may be no sub-limits for common conditions such as joint replacements and cataracts. Some policies allow lifelong renewals.

Critical Illness Insurance

Critical illnesses such as cancer, strokes, kidney disease, or heart attacks are survivable but expensive and sometimes requires long-term treatment.

Features of Critical Illness Insurance

Critical illness insurance protects you against several diseases and includes death coverage benefits. Premium can be fixed over a certain period such as for 12, 15, or 20 years while giving your long-term coverage up to 80 years old (dependent on the insurer’s terms and conditions).

Benefits of Critical Illness Insurance

The benefit of critical illness insurance plans include:

-          Coverage for specific minor and major critical illnesses

-          Death coverage paid out to beneficiaries

-          Diagnosis/surgery benefits

-          Long-term coverage

-          Can provide lump sum payout after diagnosis

This insurance plan offers coverage for life-threatening diseases and gives the insurer flexibility in deciding how to use the lump sum payout. This could be used for payment of treatments, as financial support because of loss of income due to illness or to adapt to a changing lifestyle.

The tax benefits of health insurance are governed by the Bangladeshi law. Speak to your tax advisor for more information.

Group Health Insurance

Group health insurance plans are a popular option for employers purchasing for several individuals.

Features of Group Health Insurance

Features of a group health policy include protection for employees, their spouses, and children. A policy can be customized to the company’s requirements and waiting periods are waivered. Coverage for pre-existing conditions is also made available on this type of plan.

Benefits of Group Health Insurance

Using group health insurance is normally a simple process with the following benefits, which include:

-          Hospital room rent cover

-          Payment of nursing expenses

-          Surgical procedures/diagnosis and associated costs covered

-          Costs of medicines covered

-          Pre- and post-operative care covered

-          Maternity coverage

-          Visits to medical practitioners

Group health insurance plans are affordable, covering basic healthcare needs.

How to Choose a Health Insurance Plan

1. Check the Sum Insured

Before purchasing a health plan, check the limit on the maximum sum insured. Deciding on how much your need can be calculated by an amount that equals your salary six times over. The sum insured should also be based on your age, health, and marital status.

2. Scout the Network Hospital

Each insurance company has their own list of network hospitals that they partner with. Make sure those included are in your local area and find out if cashless claims are available. If you have a preferred hospital, check to see if it’s included in the plan you want to purchase.

3. Check the Fine Print

Insurers include their own limits and sub-limits so read the fine print before purchasing a health insurance plan. Be sure you understand exactly what coverage the policy offers you for treatment, hospitalization, and other medical expenses. Check details for cover on features such as pre-and post-hospital care which may differ between plans.

4. Look for Additional Benefits

Different health policies offer several additional benefits such as no-claim bonus or restoration of your sum insured. Additional benefits such as being able to attach riders to your existing plan will enhance your financial security when faced with a medical crisis.

5. Examine the Exclusions and Other Clauses

Before purchasing a health insurance plan, read the terms and conditions carefully. Exclusions and other clauses could exempt you from certain coverage or any co-payment clause mentioned in the policy that you may be unaware of. could catch you unawares when you least expect it. Look out for waiting periods that will exclude you from making claims during a specific time.

Things to Consider When Buying Health Insurance Policy

When buying a medical policy, taking into consideration the following factors will help you purchase the best one for your financial and health well-being:

-          It offers protection against most critical illnesses

-          You can select from a large hospital network

-          The plan offers long-term coverage

-          No premium increases despite your health condition during the policy term

-          You have flexibility in choosing the type of health coverage you want

Working with a reliable insurer is vital as well as having processes that are simple to use when submitting claims.

Frequently Asked Questions (FAQ)

What is the right age to buy health insurance?

While there’s no definitive answer to this question, insurance companies do recommend buying health insurance as soon as you start earning an income. The younger you are the less likely you’ll incur waiting periods or higher premiums because of pre-existing conditions.

Is there a limit on the number of claims I can avail of in one year?

While there are no limits to the number of claims you can avail in one year, you can’t exceed the sum insured.

What can I do if I am dissatisfied with my health policy?

If you’re not satisfied with your health policy, you can change insurance providers after canceling your current medical plan. However, it’s important to fully review the terms and conditions of your policy before purchasing it to avoid dissatisfaction further down the line.

Do I have to pay from my pocket despite availing a cashless claim facility?

Certain expenses such as special nursing costs, administration and registration charges, and visitor pass fees will need to be paid out-of-pocket even when using a cashless claim facility. Check your policy for costs associated with medical treatment that won’t be covered by a cashless claim.