Definition
Family Floater
A family floater is a single health policy with one shared sum insured covering the whole family, instead of separate sums for each member.
In a floater, the sum insured 'floats' across all insured members, so it can be used by any one or several of them during the year. It is usually cheaper than buying individual policies because it pools the family's risk and is priced on the eldest member's age.
The limitation is that a single large claim can deplete the shared cover, leaving others exposed for the rest of the year, which is why a restoration benefit is valuable in floaters. For families with elderly members, individual policies sometimes work out better than a floater priced on the oldest life.
Related terms
- Restoration BenefitRestoration (or recharge) benefit automatically reinstates the health policy's sum insured once it is exhausted during a policy year, providing fresh cover for further claims.
- Super Top-UpA super top-up health policy provides extra cover above a chosen deductible, applying the deductible once across all claims in a policy year rather than per claim.
Plain-English explainer from The Dispatch Investors Encyclopedia. General information, not financial advice.