NPS Health Insurance: Due to constantly rising inflation, the costs of food, rent, electricity, healthcare, and daily expenses have all increased, making it difficult for the middle class to manage their finances. A sudden health issue in the family can easily disrupt the monthly budget. The government is offering a facility that combines retirement savings with health coverage. This scheme is known as ‘NPS Health’ and could prove very useful to you.
The Pension Fund Regulatory and Development Authority (PFRDA) has issued operational guidelines for this scheme. A key feature is the integration of a health fund and super top-up health insurance alongside retirement savings. Let us understand how much money you need to deposit in this scheme and how you can secure health coverage of up to ₹30 lakh.
What is the NPS Health Scheme?
For your information, the NPS Health scheme is divided into two components: the NPS Health investment account and the super top-up health insurance policy. These two will remain distinct in terms of legal and operational aspects. However, purchasing the health insurance policy is mandatory to participate in the scheme. This policy covers you, your spouse, and up to two children under a family floater plan; parents cannot be included in this policy.
How much needs to be deposited monthly?
Initially, a minimum of ₹1,000 must be invested in the NPS Health account. You will also need to pay the first year’s premium and applicable taxes. Additionally, an annual maintenance charge of ₹200 applies. The minimum contribution requirement is subsequently set at ₹10. Apart from the annual maintenance charge of ₹200, pension funds may levy an annual fee of up to 0.08% on the NPS Health fund.
How can I get health coverage of up to ₹30 lakh?
Under this government scheme, the super top-up health insurance component offers various options regarding deductibles and the sum insured. It offers a cover of ₹1 lakh with a deductible of ₹10,000. Coverage options include ₹5 lakh for a ₹50,000 deductible, ₹10 lakh for a ₹1 lakh deductible, and ₹30 lakh for a ₹3 lakh deductible. Please note that this policy is available to customers aged 18 to 70 years. Subject to the prescribed rules and policy terms, the policy can be renewed up to the age of 85.
Withdraw funds for medical treatment.
You can withdraw up to 25% of the contributions accumulated in your NPS Health account to cover eligible medical expenses. This may include hospitalisation and eligible OPD treatments. The funds are not paid directly to you but are instead paid to the hospital.
Which treatments are covered?
For your information, the policy covers hospitalisation, daycare procedures, home hospitalisation, AYUSH treatments, and certain specified modern medical treatments.