Have You Protected Your Family From Medical Emergencies?

When we think of saving, we think of saving for either a rainy day later, or for our retirement. We seldom make specific financial plans to help when we face medical emergencies.  That is because most of us do not think of it, to begin with.

Let us consider these two scenarios:

When Harish broke his leg in a road accident, he could not get the required treatment fast enough because he did not have the required funds he’d need for the minor surgery he needed. It was a painful and tiring 4-hour wait, while his father rushed from a neighbouring town to be by his side and pay for the treatment.

On the other hand, when 47-year-old Vikram was diagnosed with an appendix inflation,  he was preoccupied with worries of a financial nature. How was his family going to manage without his paycheck? How were they going to afford the palliative care? What do they do if someone else in the family falls sick?

Financial planning for medical emergencies might not completely remove all your anxieties but it might afford you a little peace of mind when such difficult times come into our lives. Here are some things you can do to be prepared:

1. Buy health insurance for your whole family. As of 2015, only 5% of India’s vast population had health insurance. The rest of us have been paying out of our pockets for regular health care. It is really important that you buy health insurance. Before purchasing, read the fine print and note that there are certain pre-existing diseases that are not covered during the initial years of the policy. Also, dental procedures, hernia operations etc are not covered by some insurers. If you are unsure as to how much you need, look to get at least health coverage of Rs 5 Lakhs. 
2. Buy life insurance for yourself and your spouse if you both are the main breadwinners of your family. The rule of thumb is that you should buy enough insurance coverage to cover all your liabilities. Pass on assets to your family, not debt 
3. Prevention is better than cure. Of course, you should exercise and eat well. But also, go to a doctor the moment you are concerned with your health. A lot of medical emergencies are born out of negligence. Do not neglect a persistent cough or aches and pains or other symptoms that show no sign of improvement. Seek medical intervention early on. 
4. Try to avoid using your credit card during financial emergencies. If you have enough time to apply for a personal loan to finance expensive surgery or procedure then do that. You will find it less expensive and financially draining than using a credit card. As far as you possibly can, do not use a credit card to withdraw cash. 
5. Keep an emergency medical assistance fund that is enough to cover three to nine months of expenses. In the case of an emergency that puts you out of work, you need to have enough backup to cover some months worth of expenses. Stowaway money in a savings account or in any form of easily liquid instrument that you can use during an emergency.

A financial advisor once pointed out how a person is willing and indeed eager to ensure his bike and car, but when it comes to purchasing insurance for his health, which might easily be damaged at the same time as his bike or car, he hesitates.

India has a long way to go before all Indians can enjoy good quality health care at reasonable cost, but till then it is imperative that we are prepared financially for medical emergencies so that we do not have to worry about money when we might already be bogged down by other anxieties.

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