5 Common Health Insurance Mistakes Indians Make—and How to Avoid Them
Health insurance has become an essential part of financial planning in India. With rising medical costs—where a single hospitalisation in a metro city can wipe out years of savings—having adequate cover is no longer optional. Yet, many Indians continue to make critical mistakes when buying health insurance, leaving themselves and their families financially vulnerable.
At VR Finserv, we believe the right health insurance policy is not just about tax benefits—it’s about protecting your family’s well-being and your financial stability. Let’s look at the five most common mistakes people make with health insurance—and how you can avoid them.
Insufficient Coverage
The Mistake: To save on premiums, many buyers opt for a low sum insured (₹3–5 lakh) or minimal coverage. Unfortunately, this falls short in today’s reality, where treatment for a major illness in cities like Mumbai or Delhi can easily cross ₹5–7 lakh and for critical illness treatment cost can go beyond 20-30 Lakh.
The Smart Move: Always match your cover to realistic medical expenses in your city. For most families, a base policy of at least ₹10–15 lakh, combined with a super top-up plan covering upto 1 CR , offers cost-effective protection.
Neglecting Policy Details and Waiting Periods
The Mistake: Buyers often skip reading policy documents thoroughly, overlooking fine print such as waiting periods for pre-existing conditions, disease-specific caps, room rent limits, and exclusions. These restrictions often surface only during claim time—when it’s too late.
The Smart Move: Before finalising, review:
- Waiting periods for pre-existing diseases
- Sub-limits (room rent, disease-specific expenses)
- Cashless hospital network
- Exclusions (what is not covered)
Understanding these details ensures there are no unpleasant surprises at claim stage.
Failing to Disclose Medical History
The Mistake: Some applicants hide pre-existing health conditions, thinking it will reduce premiums or avoid rejection. In reality, this can backfire—insurers may reject claims later if non-disclosure is discovered.
The Smart Move: Always disclose your complete medical history honestly. While it may increase premiums slightly, it guarantees peace of mind that your claims won’t be denied due to misrepresentation.
Relying Only on Employer Health Insurance
The Mistake: Many salaried individuals believe their employer-provided group cover is sufficient. But such policies may:
- End when you change jobs or retire
- Offer limited sum insured
- Not cover dependent family members adequately
The Smart Move: Treat your employer’s plan as a bonus cover, not your main protection. Always maintain a personal or family floater health insurance policy to ensure uninterrupted coverage regardless of job status.
Picking Policies Based Only on Premiums
The Mistake: Choosing the cheapest premium often comes at the cost of reduced coverage, smaller hospital networks, co-pay clauses, or high deductibles. In health insurance, cheapest is rarely the best.
The Smart Move: Compare policies not just on price, but on:
- Extent of coverage
- Hospital network size
- Claim settlement ratio
- Additional benefits (free health check-ups, maternity cover, no-claim bonuses)
Paying a slightly higher premium for comprehensive cover is far better than facing unexpected expenses during a medical emergency.
Final Thoughts
Health insurance is your family’s safety net in uncertain times. Avoiding these common mistakes ensures that when you need it most, your policy will truly protect you. Remember: the cheapest or easiest option is not always the best—right coverage matters more than low premiums.
At VR Finserv, we help you:
Choose the right health insurance plan for your family’s needs Ensure adequate coverage against rising medical costs Review your policy so you’re never caught off guard
Secure your family’s health and peace of mind today.
Connect with VR Finserv for a personalised consultation.
