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What is the Importance of Micro Health Insurance

We are all aware of the fact that India is an emerging country with a significant amount of the population living in rural areas with limited access to hospitals and clinics. Up-to-date data indicates that 65.53% of India’s population lives in rural areas. They work in small companies or in agriculture to make a living. The worst part is that since there is less awareness about diseases rural families are more vulnerable to them about the Importance of Micro health insurance. The family struggles to treat the illness whenever there is a medical emergency since they cannot afford appropriate healthcare and medical services.

A micro health insurance plan can turn out to be the best thing for you to address these problems. Micro health insurance plans, often known as bite-sized health insurance plans, are unique medical insurance programs created for individuals who are unable to pay for costly medical services. For those who live in remote locations, these plans are the greatest solution.

Micro health insurance policies can be valuable health insurance add-ons for certain people, yet they might also be their only source of emergency cash. There are lots of important micro health insurance which can benefit you. Let’s look at the Importance of Micro health insurance and its benefits in this article.

What is Micro Insurance?

Microinsurance is a sort of insurance that has been designed for less valuable assets, for those making little money, and for people with incredibly tiny savings. There are many importance of health insurance that helps people to ease their livelihood.

What is Micro Health Insurance?

A group of plans for insurance designed to promote the health of the nation’s economically challenged people is known as micro health Insurance. This policy was developed by India’s Insurance Regulatory and Development Authority (IRDAI). According to the microinsurance guidelines provided by the IRDAI in 2005, microinsurance is regulated. These contracts might fall under the umbrella of insurance in general and have much importance in micro health insurance.

However, the feature that distinguishes the policy is that the promised money offered must be equal to or less than 50,000 rupees. Microinsurance can provide some form of protection through insurance for the economically vulnerable population.

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Features of Micro Health Insurance

Let’s look at the few features of Micro health insurance below

  1. Typically, the insured total is a limited sum. It could cost anywhere from Rs 1 lakh to Rs 5 lakh.
  2. Since premiums are minimal and the primary focus is on delivering excellent medical care at a low cost, micro health insurance is founded on the principle of offering affordable health coverage to the poor.
  3. The importance of microinsurance in people’s lives is that it generally provides a year of coverage for each of its policies.
  4. Another alternative is to get complete coverage on a family floater basis, which will protect everyone in the family.
  5. Since the coverage amount is restricted, pre-medical exams are typically not necessary when acquiring the plan.
  6. The oldest person allowed is 65 years old.

Benefits of Micro Health Insurance

In addition to the mentioned features, micro health insurance plans also provide the following advantages:

  1. Micro health insurance also covers Pre-hospitalization fees.
  2. There is a documentation process for claiming insurance, even after purchasing it. The release of post-hospitalization funds can be made simple by the micro health insurance policy, which ensures that one is not required to go through the extra trouble of such a time-consuming procedure.
  3. Micro health insurance plans cover Childcare medications also.
  4. Some socioeconomic levels struggle to cover even the ambulance fee. The insurance policies also make sure that the scheme covers the expense of an ambulance.

Why Micro Health Insurance is Important?

We are aware of the way we stand in terms of the impoverished regions of our nation. The most tragic thing is that the majority of persons in this group have several serious diseases and still receive inadequate healthcare.

For those with little or no savings, the importance of health insurance policies is important. Unfortunately, rural families are given inadequate access to healthcare despite having a higher risk of sickness.

Frequently, people’s ignorance and lack of awareness of these issues make matters worse. For such issues, the importance of micro-health insurance comes into play. The importance of micro health insurance assists those who fall into the category of low-income individuals. This population makes a living through farming as well as other small businesses and hobbies.

Since there is less understanding among people in general, the problem of worry is that rural households are more susceptible to ailments. The family struggles to treat any ailment or illness whenever a medical emergency arises since they cannot afford high-quality healthcare and medical services.

Types of Micro Health Insurance Plans

The two broad categories beneath can be used to classify micro-insurance policies. When choosing a health insurance plan, this article can help you in making the best decision. Let’s discuss two types of Microinsurance plans below-

1. Basic Micro Insurance

Regular or general micro-insurance products may include assets such as huts, cattle, and other assets in addition to personal accidents, health insurance, and asset coverage. This product is accessible both in a group setting and one-on-one.

2. Micro Insurance for Life

Life plans of Microinsurance can be either endowment or term plans. It can be used both individually and in groups, and it might or might not come with accident benefits. These plans might also relate to health insurance.

Attractive Features of Micro Insurance for Life

The following are some of the features of the schemes:

  • Due to the micro features of this type of plan, the sum amount is guaranteed. In most cases, the range of the sum is between 1 lakh and 5 lakh rupees.
  • Companies that offer micro insurance make sure that these types of insurance are fairly priced and accessible by the basic basis upon which they operate. The company’s main goal is to offer affordable, high-quality healthcare facilities and services.
  • For plans provided by these sorts of insurance, coverage is given for a year.
  • There is yet another option that offers you the possibility of covering every member of that family. You can get it by purchasing a full policy and a family floater.
  • Pre-entrance health checks are not necessary when someone has an objective of acquiring the plan because the coverage amount is modest.
  • The age restriction specifies a maximum age of 65 years.
  • The lifelong benefit of renewal is the most valuable and alluring feature of such insurance.

Why should I Choose a Micro Health Insurance Policy?

Micro health insurance plans are the most preferred insurance. There are various reasons that you must buy these plans:

1. Goal-based Financial Planning

Identify and choose appropriately when you get medical insurance at the beginning. If saving or security are your top financial priorities, you should choose the greatest health insurance option that will enable you to meet one or both of these objectives.

2. Premiums are Reasonably Priced

By combining both savings and reasonable health insurance premiums in one package, investing in a micro-insurance instrument will bring you the greatest price for a win-win situation.

3. Advantages of Tax

Earn from the tax advantages that come with the premium invested and their maturity, by Sections 10(10D) and 80C of the current income tax regulations. Although the GST (Goods and Services Tax) exemption applies to premium payments as well, it is subject to modification following applicable tax regulations.

A Step Forward Micro Health Insurance

In India, a large number of NGOs and organizations are proactively promoting awareness of the value of health insurance. Numerous organizations and government hospitals provide free medical services and examinations. The Indian government intends to implement other such programs, such as micro health insurance plans, to monitor and care for the rural population’s health.


Microinsurance has benefited a lot of people and has proven to be profitable for our nation. Numerous diseases are now more widely known, and people are taking greater responsibility for their health as well as the health of their families.

Many NGOs and semi-public groups have stepped forward to offer their assistance. Micro health insurance schemes, however, have made significant contributions to society. The goal of creating these strategies is gradually and steadily becoming a reality. People are starting to appreciate the value of good health, appropriate medication, and insurance.

What is the Importance of Micro Health Insurance – FAQs

Explain What is Micro Insurance?

Ans. Microinsurance is a sort of insurance that has been designed for less valuable assets, for those making little money, and for people with incredibly tiny savings.

Please tell me What is the importance of Micro health insurance?

Ans. For those with little or no savings, there is a lot of importance of Micro health insurance as it provides several benefits. Rural families are given inadequate access to healthcare despite having a higher risk of sickness. In such cases, health insurance provides all the needed policies for healthcare.

What advantages do microinsurance policies offer?

Ans. The main benefit of microinsurance is that it gives a low-cost way for those in the community who are economically destitute to get insurance. They can get financial support during difficulty by purchasing MicroInsurance Policies.

Why should we buy a micro health insurance policy?

Ans. You should choose a micro health insurance policy because it helps lots of people with little savings and money during emergency health conditions.

What are the benefits of Micro Insurance?

Ans. Microinsurance is beneficial as it provides goal-based financial planning, affordable prices, and lots of tax advantages. 



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