Family Floater Health Insurance: Why It’s the Best Option for Your Family
Mini Balakrishnan
With rising medical costs in India, having a solid health insurance plan is no longer a luxury but a necessity. Family Floater Health Insurance is a smart and cost-effective way to safeguard your entire family under a single policy. Instead of managing multiple individual plans, a family floater allows all insured members to share the insured sum, ensuring flexibility and financial security during medical emergencies.
In a country where healthcare expenses are steadily increasing, an unexpected hospitalisation can put a significant strain on your savings. A Family Floater Health Insurance plan covers hospital bills, doctor consultations, diagnostic tests, and even pre- and post-hospitalisation expenses. Since the coverage is shared, any family member can utilise it as needed, making it an efficient and budget-friendly option. By opting for a family-centric insurance plan, you ensure quality healthcare for your loved ones without financial stress.
What is Family Floater Health Insurance?
Family Floater Health Insurance is a type of health insurance plan that covers multiple family members under a single policy with a shared sum insured. Instead of buying separate individual policies for each member, a family floater allows everyone to be protected under one comprehensive plan. This ensures financial security and peace of mind in case of medical emergencies.
Unlike individual health insurance, where each person has a separate sum insured, a family floater policy allows the entire family to utilise a common coverage amount. For instance, if a family of four has a ₹10 lakh policy, any member can use the full amount if needed, making it a more flexible and cost-effective option.
Typically, a Family Floater Health Insurance plan covers the policyholder, spouse, children, and dependent parents. Some insurers also allow in-laws to be included, depending on the policy. The premium for a family floater plan is calculated based on the age of the eldest member in the plan, as older individuals are considered a higher risk. This makes it essential to choose the right coverage amount to ensure adequate financial protection for the entire family.
How Does Family Floater Health Insurance Work?
Family Floater Health Insurance operates on a shared sum insured model, meaning all insured family members can utilise the total coverage amount as needed. For example, if a policy has a ₹10 lakh sum insured, any member—be it the policyholder, spouse, children, or dependent parents—can claim expenses up to this limit. This makes it highly flexible and cost-effective, ensuring that funds are available for whoever needs medical care the most.
Claims can be made multiple times in a year as long as the total sum insured is not exhausted. If one family member undergoes treatment and uses ₹3 lakh from a ₹10 lakh policy, the remaining ₹7 lakh is still available for future medical needs within the policy year.
Most insurers offer cashless hospitalisation at network hospitals, where the insurer directly settles the bill with the hospital. This reduces the financial burden during emergencies, as policyholders don’t have to pay out of pocket. Suppose treatment is taken at a non-network hospital. In that case, the insured must pay the expenses upfront and then apply for reimbursement, submitting necessary documents like medical bills and discharge summaries for approval.
List of Family Floater Plans
| Family Floater Health Insurance Plans | Entry Age Cap | Sum Insured Limit (in ₹) |
| Aditya Birla Activ Health Platinum Plan | 91 days onwards | 2 lakh – 2 crore |
| Bajaj Allianz Family Floater Health-Guard Plan | 3 months – 30 years | 1.5 lakh to 1 crore |
| Care Health Insurance Plan | 91 days and above | 1 lakh – 6 crore |
| Cholamandalam MS Healthline Insurance Plan | 5 – 65 years | 1 – 25 lakh |
| Digit Health Insurance Plan | 91 days onwards | 2 lakh – 3 crore |
| Future Generali Health Suraksha Plan | 90 days – 70 years | 50,000 – 10 lakh |
| HDFC ERGO Optima Secure Plan | 91 days – 65 years | 5 lakh – 2 crore |
| ICICI Lombard Elevate Plan | 91 days onwards | 5 lakh onwards |
Benefits of Family Floater Health Insurance
A Family Floater Health Insurance plan offers comprehensive coverage, financial security, and convenience, making it an ideal choice for families looking for cost-effective and flexible healthcare protection.
Cost-Effective Compared to Individual Plans
One of the biggest advantages of Family Floater Health Insurance is its affordability. Instead of purchasing separate health insurance policies for each family member, a single premium covers all insured members. This significantly reduces the total cost while ensuring comprehensive coverage for everyone.
For example, if an individual health insurance plan costs ₹10,000 per person, a family of four would pay ₹40,000 annually for separate policies. However, a family floater plan with a shared sum insured of ₹10 lakh may cost around ₹25,000–₹30,000, leading to significant savings while offering the same or even better coverage.
Higher Sum Insured for the Entire Family
Unlike individual policies where each member gets a fixed coverage amount, Family Floater Health Insurance allows the entire sum insured to be utilized by any member in case of a medical emergency.
For instance, if a family of four has a ₹10 lakh sum insured, one member can use the entire amount for major surgery or multiple members can claim smaller amounts throughout the year. This flexibility ensures that funds are available when needed the most, offering better financial protection.
Flexibility & Convenience
Family floater plans provide flexibility in adding new members. If a policyholder gets married or has a newborn, they can easily include them in the plan without purchasing a separate policy.
Additionally, managing one policy is far more convenient than keeping track of multiple individual plans, renewal dates, and premium payments. This reduces paperwork, simplifies the claims process, and ensures that the entire family is covered under a single comprehensive policy.
Tax Benefits
Premiums paid for Family Floater Health Insurance are eligible for tax deductions under Section 80D of the Income Tax Act, 1961. This helps policyholders save on taxes while securing their family’s health.
- For self, spouse, children: Up to ₹25,000 deduction per year.
- For parents (below 60 years): Additional ₹25,000 deduction.
- For senior citizen parents (above 60 years): Additional ₹50,000 deduction.
If the policyholder and parents are both senior citizens, the total deduction can go up to ₹1,00,000 per year.
Covers Rising Healthcare Costs & Medical Inflation
With medical inflation in India increasing at a rate of 10-15% per year, healthcare costs are becoming unaffordable without insurance. Family floater plans cover:
- Hospitalization expenses (room rent, doctor’s fees, ICU charges).
- Daycare treatments (procedures that don’t require 24-hour hospitalization).
- Advanced medical treatments like robotic surgeries, organ transplants, and critical care treatments.
This ensures financial security against unexpected medical expenses, preventing out-of-pocket spending during emergencies.
Cashless Treatment & Large Network of Hospitals
Family floater plans offer cashless hospitalization at network hospitals, eliminating the need for upfront payments during medical emergencies. Instead of paying from their pocket and seeking reimbursement later, policyholders can avail of direct treatment without financial stress.
Here’s how cashless hospitalization works:
- The insured gets admitted to a network hospital and provides their insurance details.
- The Third-Party Administrator (TPA) or the insurance provider verifies the claim.
- Upon approval, the insurer settles the hospital bill directly, covering all eligible expenses.
With a vast network of hospitals across India, policyholders can access quality healthcare services without worrying about expenses, ensuring timely and hassle-free treatment for the entire family.
Eligibility Criteria for Family Floater Health Insurance Plan
To avail of a Family Floater Health Insurance Plan, policyholders must meet certain eligibility requirements. Here are the key criteria:
- Primary Policyholder’s Age – The minimum entry age for the primary policyholder is usually 18 years, while the maximum age limit varies between 60 to 65 years, depending on the insurer.
- Eligible Family Members – Typically, family floater plans cover self, spouse, dependent children (up to 25 years), and dependent parents. Some insurers also allow the inclusion of in-laws under the policy.
- Children’s Age Limit – Dependent children can usually be covered from birth or 91 days onwards. However, once they cross the maximum dependent age (18-25 years, based on the insurer), they must purchase an individual policy.
- Maximum Number of Members – Most plans allow 2 to 6 members under a single policy, though some policies extend coverage to up to 15 family members with additional premiums.
- Premium Based on Eldest Member – The premium is calculated based on the age of the eldest insured member, as older individuals are considered a higher risk. This may slightly increase the overall cost if senior citizens are included.
- Medical Tests for Older Applicants – Some insurers require pre-policy medical check-ups for individuals above 45-60 years, depending on the policy terms, to assess their health condition before approving coverage.
Who Should Buy Family Floater Health Insurance?
A Family Floater Health Insurance Plan is ideal for individuals who want comprehensive health coverage for their entire family under a single policy. It is particularly suited for:
- Young couples planning a family – Newly married couples or those planning to have children can benefit from a single policy that can later include newborns.
- Families with dependent children – Parents can secure medical coverage for their children until they become financially independent, ensuring seamless healthcare protection.
- Those looking for a cost-effective health insurance solution – Since a family floater plan allows members to share the sum insured, it is more affordable than buying multiple individual policies.
- Individuals who prefer an easy-to-manage policy – Instead of juggling multiple renewal dates and policy details, a single plan simplifies management, reducing paperwork and hassle.
Who Should Avoid a Family Floater Plan?
While a family floater policy is beneficial for many, it may not be the best choice for families with elderly parents. Since premiums are calculated based on the eldest member’s age, including senior citizens can significantly increase the cost. Additionally, older individuals may have higher medical needs, which could quickly exhaust the sum insured, leaving younger members underinsured. In such cases, it is advisable to purchase a separate individual health insurance policy for elderly parents to ensure adequate coverage.
Factors to Consider When Choosing a Family Floater Policy
Selecting the right Family Floater Health Insurance requires careful evaluation of coverage, eligibility, and costs to ensure maximum benefits for your loved ones.
Sum Insured – How Much Coverage is Enough?
Selecting the right sum insured is crucial to ensure sufficient financial protection for all family members. The amount should be high enough to cover hospitalization expenses, medical treatments, and surgeries without burdening savings.
Factors to consider while deciding the sum insured:
- Number of family members covered – More members require a higher sum insured.
- The age group of insured individuals – Older individuals may need higher coverage due to increased medical risks.
- Pre-existing health conditions – Families with members having chronic illnesses should opt for a higher sum insured.
- Medical inflation – Healthcare costs in India are rising annually, making higher coverage essential for future medical needs.
Age of the Oldest Family Member – How it Affects Premium
The premium of a family floater plan is calculated based on the age of the eldest insured member. If an elderly parent (above 60) is included, the premium increases significantly as insurers consider them high-risk.
- If the oldest member is young (30-40 years), premiums remain affordable.
- If a senior citizen is included, consider a separate individual health insurance plan for them instead of a family floater.
Who is Covered Under the Plan?
Family Floater Health Insurance typically covers:
Self (policyholder)
Spouse
Dependent children (up to 25 years, depending on the insurer)
Parents and in-laws (optional, varies by policy)
Some policies may have age restrictions for children, after which they need a separate individual policy. Always check the family eligibility criteria before purchasing a plan.
Coverage and Inclusions – What Does the Policy Cover?
A good family floater policy should provide coverage for essential medical expenses, including:
Hospitalization expenses – Room rent, ICU charges, surgeries.
Pre & post-hospitalization – Medical tests consultations before and after hospitalization.
Daycare procedures – Minor surgeries that don’t require 24-hour hospitalization.
Ambulance charges – Emergency transportation costs.
Maternity benefits – Some policies offer coverage for pregnancy and newborn care.
Alternative treatments (Ayush) – Ayurvedic, Homeopathy, and Unani treatments in approved hospitals.
Additional features like critical illness cover, OPD (outpatient department) cover, and wellness benefits should be checked before finalizing a policy.
Exclusions – What is NOT Covered?
Reading the exclusions section of a policy is crucial to avoid unexpected claim rejections. Some common exclusions include:
Pre-existing diseases – Covered only after a waiting period.
Cosmetic surgeries – Unless medically necessary.
Dental treatments – Unless caused by an accident.
Self-inflicted injuries – Intentional harm is not covered.
Maternity costs – Unless specifically included in the policy.
Non-allopathic treatments – Some policies exclude Ayurveda, Unani, Siddha, or Homeopathy.
Always check for specific exclusions in your chosen policy to ensure adequate coverage.
Waiting Period – How Long Before Coverage Starts?
The waiting period is the time you must wait before making claims for certain treatments. Understanding different types of waiting periods helps in better planning:
- Initial Waiting Period – Usually 30 days, applicable to all new policies.
- Pre-existing Disease Waiting Period – 2-4 years before coverage starts.
- Maternity & Newborn Cover – 2-4 years (if included in the policy).
- Specific Disease Waiting Period – Some illnesses (like hernia or joint replacements) may have a waiting period of 1-2 years.
Choose a policy with a shorter waiting period if you have existing health conditions requiring early coverage.
Network Hospitals – Cashless Treatment Availability
Most family floater policies offer cashless hospitalization at network hospitals, where the insurer settles bills directly with the hospital. This reduces out-of-pocket expenses during emergencies.
- Always check the list of network hospitals in your city before buying a policy.
- Ensure that top-tier hospitals in your area are included to guarantee hassle-free treatment.
Claim Settlement Ratio – Reliability of the Insurance Provider
The Claim Settlement Ratio (CSR) indicates the insurer’s efficiency in approving and settling claims. It is calculated as:
CSR = (Total Claims Settled ÷ Total Claims Received) × 100
- A higher CSR (above 95%) means the insurer has a strong track record of timely claim approvals.
- Insurers with a low CSR may have a complex claim process, leading to delays or rejections.
Always choose an insurer with a high claim settlement ratio to ensure a smooth claims experience for your family.
How to Buy a Family Floater Health Insurance Plan?
Purchasing a Family Floater Health Insurance Plan is a simple process, and you can choose between online and offline methods based on your preference and convenience.
Online vs. Offline Purchase
| Mode | Advantages | Disadvantages |
| Online Purchase | – Quick and hassle-free process. – Easy policy comparison across multiple insurers. – Lower premiums due to no middlemen. – Instant policy issuance. | – Limited personal assistance. – Requires basic knowledge to choose the right policy. |
| Offline Purchase | – Assistance from agents or insurance representatives. – Personalized guidance on choosing the best policy. | – Higher premium due to commission charges. – Time-consuming paperwork. – Limited options compared to online platforms. |
For a faster and more cost-effective approach, online purchase is recommended, while offline purchase may be beneficial for those seeking expert advice.
Steps to Buy a Family Floater Health Insurance Plan
- Assess Your Family’s Needs – Determine the sum insured based on the number of members, their age, and medical history.
- Compare Policies – Use online insurance portals or company websites to compare coverage, premiums, waiting periods, exclusions, and network hospitals.
- Choose the Right Policy – Select a plan that offers comprehensive coverage with a high claim settlement ratio (CSR) and a strong network of hospitals.
- Check Policy Terms & Conditions – Read the inclusions, exclusions, waiting periods, and sub-limits to avoid claim disputes in the future.
- Fill Out the Proposal Form – Provide personal details, medical history, and the details of insured family members. Ensure accuracy to avoid claim rejections.
- Undergo Medical Tests (if required) – Some insurers require pre-policy health checkups for applicants above a certain age (usually 45-60 years).
- Make the Payment – Pay the premium online through net banking, credit/debit cards, or UPI. For offline purchases, payment can be made via cheque or cash.
- Receive the Policy Document – After payment, you will receive the policy document and health card via email (for online purchases) or in physical format (for offline purchases). Keep it handy for future claims.
- Activate and Use – Once activated, you can avail of cashless hospitalization at network hospitals or make reimbursement claims for medical expenses.
Buying a Family Floater Health Insurance Plan is a crucial step in securing your family’s health and financial well-being. Choose wisely to ensure seamless medical coverage when needed.
How to Make a Claim Under a Family Floater Policy?
When a medical emergency arises, filing a claim under a Family Floater Health Insurance Plan can be done through two methods: Cashless Claims and Reimbursement Claims. Understanding both processes ensures a smooth and hassle-free experience.
Cashless vs. Reimbursement Claims
| Claim Type | Process | Key Benefits |
| Cashless Claim | The insurance provider directly settles the hospital bill with a network hospital. | No out-of-pocket expenses, faster processing, and minimal paperwork. |
| Reimbursement Claim | The insured pays the medical expenses upfront and later submits bills for reimbursement. | Useful when treatment is taken at a non-network hospital. |
Steps for Claim Process
1. Cashless Claim Process (For Network Hospitals)
- Choose a network hospital from the insurer’s list.
- Inform the Third-Party Administrator (TPA) or insurer at least 24-48 hours before planned hospitalization (or within 24 hours for emergencies).
- Submit the cashless request form and policy details at the hospital’s insurance desk.
- The insurer verifies and approves the claim based on policy terms.
- Once approved, the hospital bills are directly settled by the insurer, and the insured only pays for non-covered expenses (if any).
2. Reimbursement Claim Process (For Non-Network Hospitals)
- Pay the medical bills upfront at the hospital.
- Collect and keep all medical documents – hospital bills, discharge summaries, doctor’s prescriptions, diagnostic reports, and payment receipts.
- Submit the reimbursement claim form along with supporting documents to the insurer within the specified time frame.
- The insurer verifies the claim and processes the approved amount directly to the insured’s bank account.
Tips to Ensure Smooth Claim Approval
Keep all medical documents – Ensure that hospital bills, prescriptions, diagnostic reports, and discharge summaries are properly maintained.
Follow the insurer’s claim procedure – Delays or incomplete forms can lead to claim rejection. Always notify the insurer on time.
Check the claim settlement ratio (CSR) before purchasing a policy – A high CSR (above 95%) indicates a reliable insurer with better chances of claim approval.
Understand policy exclusions – Some treatments, pre-existing conditions, and waiting periods may apply. Knowing these beforehand avoids unexpected claim denials.
Use network hospitals for cashless benefits – This reduces financial stress and speeds up the treatment process.
By following these steps and precautions, you can ensure a smooth and hassle-free claim process, providing timely medical care to your family without financial burden.
Difference Between Family Floater and Individual Health Insurance
| Parameters | Individual Health Insurance | Family Floater Health Insurance |
| Coverage | Coverage is only provided to the policyholder | Coverage is equally provided to all the family members enrolled in the plan |
| Premium | Premium is usually high and varies as per the age, medical history, and add-ons availed by the policyholder | Premium is comparatively lower than individual health insurance because all family members get covered under a single plan |
| Benefits | Medical expenses of the policyholder are covered | Medical expenses of all the enrolled family members are covered |
| Members Covered | Only the policyholder can avail of coverage | Four to eight family members can be enrolled in one plan |
Conclusion
A Family Floater Health Insurance Plan is one of the best ways to secure your family’s medical future. It offers comprehensive coverage, ensuring that all insured members have access to quality healthcare without financial strain. The cost-effectiveness of a single policy, the flexibility of a shared sum insured, and the ease of managing one plan instead of multiple individual policies make it a practical choice for families.
With rising healthcare costs and the unpredictability of medical emergencies, having a family-centric insurance plan is more important than ever. Before purchasing a policy, compare different plans, check the sum insured, coverage benefits, exclusions, and claim settlement ratio, and choose one that best suits your family’s needs. Investing in the right Family Floater Health Insurance Plan today ensures financial security and peace of mind for your loved ones in the future.
FAQs on Family Floater Health Insurance
1. What is a family floater health insurance plan?
A Family Floater Health Insurance Plan is a single policy that provides medical coverage to multiple family members under a shared sum insured. Instead of purchasing separate plans, all insured members can utilise the coverage as needed, making it a cost-effective and flexible option.
2. Does a family floater policy cover pre-existing diseases?
Yes, most family floater plans cover pre-existing diseases, but only after a waiting period of 2-4 years, depending on the insurer. It’s essential to check the policy terms and choose a plan with a shorter waiting period for pre-existing condition coverage.
3. Are maternity and newborn expenses covered under a family floater policy?
Some family floater policies include maternity benefits and newborn cover, but they often come with a waiting period of 2-4 years. Coverage usually includes delivery expenses, newborn hospitalization, and vaccination costs, but it’s best to verify the policy details before purchasing.
4. Can I add a new family member to an existing family floater plan?
Yes, most insurers allow policyholders to add a spouse after marriage or a newborn after birth, usually after informing the insurer and paying an additional premium. However, adding elderly parents may increase the overall premium significantly.
5. What happens if one family member uses the entire sum insured?
If one member exhausts the entire sum insured, other family members will no longer have coverage for the remaining policy year. Some policies offer restoration benefits, which automatically reinstate a part or full sum insured, but this feature varies across insurers.
