It has been said that life is very unpredictable and there is a lot of truth to that saying. There are people who are very healthy, fall sick suddenly and then discover that they got a critical illness. There are people who are very careful in everything they do. including on the road, but, got knocked over by other careless drivers and ended up lying in hospital for months. These cases happen every now and then and we all know what follow next: the huge medical fee.
The purpose of health insurance is to protect and cover you financially when it comes to medical fee. The way it works is similar to other insurance like the life or auto insurance: you pay a sum of money to the insurance company monthly or yearly and they will help to pay your medical cost at a predetermined principal sum up to a limit.
( can be added to any existing mediclaim policy) tax savings u/s 80d.