When Should One Go for a Medical Loan?

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Depending on the ailment, undertaking a surgery or medical treatment in India can be very expensive, with costs ranging from 5 to 10 lakhs or even higher. Additionally, over 80% of Indians are not covered under any health insurance plan, thus are exposed to the risks of a financially crippling hospital bill in case of any medical emergency for them or their family members.

Medical Audit

Availability of medical loans from medical loan specialists or through a personal loan from banks has proved to be a savior for Indians, facing a shortfall of cash or insurance for the treatment of their close family members.

Listed below are the instances when you can consider going for a medical loan in India:

When You Have No Health Insurance or Are Under-Insured

This is particularly true for treatment of ailments such as cancer or major heart problems, which can be very expensive depending on the individual’s medical condition and history. Most people with no health insurance or low insurance cover may run out of money midway through an expensive treatment process. In this case, financing the rest of the treatment can be done using a medical loan.

When Your Medical Treatment is Not Covered by Insurance

While health insurance covers most of the life-threatening diseases, they are not available for so-called “cosmetic” interventions such as eye vision correction, dental problems, hair restoration, and plastic surgeries. In such instances, a medical loan can be considered to pay off the bills following these interventions.

When Banks Charge High Interest Rates on Personal Loans

Most banks consider the credit rating of the loan applicant to decide the interest rate that they would be charging on the personal loan. This could result in a high interest rate or low disbursed amounts, thus resulting in financial difficulties for the borrower. Compared to personal loans, medical loans are disbursed according to the cash requirement of the borrower and are charged reasonable interest rates, irrespective of the borrower’s credit rating. Additionally, as compared to bank loans, most medical loan companies in India offer medical loans without any collateral security or guarantor agreement.

When You Have No Savings, and Must Depend on Your Credit Card

Availing a medical loan is advisable when you have poor savings or have to depend on your credit card to pay for the medical expenses. Most borrowers in this category, may already be struggling to pay their credit card bills in full, owing to the high interest rate charged by credit card companies on pending amounts. In such cases, using a credit card would only add to your monthly repayments, and can further reduce your credit rating.

When You Need Urgent Funds

As medical emergencies come unannounced, most of us are caught in the state of requiring urgent funds. While cashless insurance at major hospitals can serve us in such situations, there can be instances when you are in dire need of quick cash. Relying on friends or family or a personal loan disbursement can be a time-consuming process for most borrowers. For quick cash disbursement, a medical loan is much more suitable than personal loans, as they are approved and disbursed in a shorter period.

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