First we, remixed old hindi film numbers, then fashion styles (Sushmita Sen teamed a saree with a spagetti in Main Hoon Na?). Food too, chinese bhel and paneer pizzas.

We also remixed financial products. Unit linked insurance is a classic example. Now, there’s one more — unit linked health insurance. That’s unit linked investments plus medical insurance for you.

What is a unit linked health insurance plan?

Simply put, it means that you can now pay one annual premium, part of which will get invested to give you returns, and the rest will be used to buy you a health insurance, more populary called mediclaim.

Mani , 41,* who lives in Delhi wants to know whether he should opt for this scheme.

Mani’s wife is 37 and they have two children, aged, 7 and 9 respectively. All these years he has been buying a medical insurance policy for his family. He would pay an annual premium of Rs 9,137 and get a cover of Rs 7 lakh for his family. This would care of all their medical needs. And since he had not made a claim yet on his policy, he had accumulated a no-claim bonus of Rs 2.31 lakh, thus increasing his total cover to Rs 9.31 lakh.

Now, he says, “I have read many articles in the newspapers recently regarding mediclaim policies and I am really confused. I have decided to discontinue my existing mediclaim policy and to go for the new unit linked health insurance policies being offered by leading life insurance companies. Here, by paying a sum of Rs 28,500 as yearly premium I can get my family insured for Rs 14 lakh (Rs 5 lakh for my wife and Rs 3 lakh each for myself and my kids). I can also make investments.”

He asks two questions:

i. Should he switch form a mediclaim policy to a unit linked health insurance plan? No

The client is advised not to go for a unit linked health insurance plan as cash less hospitalization facilities are not available.

In a volatile market situation like the prevalent market condition it is not advisable to go for a unit linked health insurance plan as mediclaim policy offers cashless hospitalization and you need not be worried about the market condition as health is very important and timely health care is absolutely essential.

ii. How will the premiums be treated, with respect to tax benefits? Will get Tax benefits