How to Calculate How Much Health Cover You Need

Most Indians are significantly under-insured for health costs. A ₹3 lakh policy bought ten years ago may cover less than a single night in a private ICU today. Working out the right sum insured is not guesswork — there is a logical process you can follow in under an hour.

Step 1: Research Typical Hospital Costs in Your City

Medical inflation in India runs at around 10–14% per year, well above general inflation. Look up typical costs for common procedures at private hospitals in your city:

• Appendectomy: ₹60,000–₹1.5 lakh
• Angioplasty: ₹1.5–₹3 lakh
• Knee replacement: ₹2–₹4 lakh
• Cancer treatment (chemotherapy course): ₹5–₹20 lakh

In metro cities, assume the higher end of these ranges.

Step 2: Apply the City Multiplier

As a starting benchmark, use these minimum individual cover levels:

• Tier 1 cities (Mumbai, Delhi, Bengaluru, Chennai, Hyderabad): ₹10–15 lakh
• Tier 2 cities: ₹7–10 lakh
• Tier 3 cities and towns: ₹5–7 lakh

Step 3: Account for Your Age

Younger buyers (under 35) are less likely to face high-cost claims soon, but they are also at the start of a long policy relationship — buying more cover now costs far less per rupee than adding it later when you are older or have developed conditions.

Buyers above 45 should seriously consider a super top-up policy in addition to a base plan to extend cover to ₹25–50 lakh at affordable premiums.

Step 4: Factor in Family Size

A family floater plan divides the sum insured among all members. If two family members are hospitalised in the same year, the total benefit available is the single sum insured — not a multiple of it. For families with elderly parents or young children prone to illness, consider:

• A floater for the younger family unit (self, spouse, children)
• Separate individual or senior-citizen plans for parents

Step 5: Check If Your Employer Cover Creates a False Sense of Security

Group health cover through your employer typically provides ₹2–5 lakh and ceases the moment you leave the job. Never count it as permanent protection. Your personal policy must be sufficient to stand alone.

Step 6: Add a Super Top-Up for Cost-Effective High Cover

A super top-up plan kicks in once your base policy sum insured is exhausted in a policy year. A ₹20 lakh super top-up with a ₹5 lakh deductible costs a fraction of a standalone ₹25 lakh plan. This is the most efficient way to reach high cover levels.

Step 7: Revisit Your Sum Insured Every Three Years

Medical inflation means your cover needs to grow over time. Review and increase your sum insured or add a top-up at least every three years — most insurers allow you to enhance cover at renewal without fresh underwriting if you have not made claims.

Conclusion

Under-insurance is a choice that looks like a saving but becomes a catastrophe in a crisis. Use this framework to arrive at a defensible number, then compare products that meet that floor. TruePolicy''s tools and advisors can help you fine-tune the calculation for your specific family profile.