Author: Himanshu Dixit

If you have a health policy, the prospect of paying a huge sum out of pocket will sound totally ludicrous to you. And yet, this is what is happening. Even those that have health insurance do not have enough cover. The whole situation is exacerbated by the rising cost of health care at 20% a year. Not enough health coverage is an issue most policyholders need to address. How do they do it?

One obvious way to increase the cover is by getting a separate health policy of a higher cover amount. Very well. But you will have to keep in mind that this is not the most affordable way to do it. A cover of 15 lacs will cost you upwards of Rs. 10,000 in premium. Is there any cheaper way? Absolutely, there is!

 Heard of super top-up plans?

Super top up plans are policies that kick in once you’ve made claims up to a threshold limit. One can also call them ‘plans with a high deductible’. Get it with an example. You take a super top up plan of cover amount Rs 10 lacs with Rs 3 lacs deductible. That means once you’ve paid Rs 3 lacs, you can use your super top up policy to claim the rest 7 lacs.

Read more about super top-up plans

 Understand the deductible

To understand how deductible is calculated, consider the following example: You’ve two policies- A mediclaim policy of Rs 3 lacs and a super top–up plan of Rs 10 lacs with deductible Rs 3 lacs. Let’s suppose you make 5 claims in a year the following way-

 Don’t worry, it’s affordable

The union budget 2016 has finally unfolded. Amidst all the recommendations and expectations, the finance minister Arun Jaitley has presented a budget that has something for all the sectors with strong focus on rural sector in particular. Some key announcements have also been made for the social sector vis a vis education and healthcare. We look at some of the key propositions in the budget 2016 for the insurance sector.

Health Insurance for Families & Senior Citizens

For insurance sector, budget 2016 announced an important scheme. As a logical extension of pradhanmantri suraksha bima yojana and pradhanmantari jeevan jyoti yojana, the Government of India has proposed health protection scheme to provide Rs 1 lakh cover to families that can’t afford healthcare. For senior citizens, the covered amount is 1.3 lakh. The government has also announced to start a dialysis programme to counter the rising no. of renal diseases and lack of affordable treatment centres.

Relief for Farmers- Crop Insurance

The budget has a lot for the farmers as well. In addition to agricultural infrastructure development, the budget allotted Rs 5500 crore to Prime Minister Fasal Bima yojana. Under this scheme, the farmers will be required to pay only 2% of the premium for Kharif crops and 1.5% of the premium for Rabi crops. The rest of the cost will be borne by the government. This will encourage more farmers to insure their crops against the risk of natural calamities.

No Relief on Service Tax

One of the things we wished for the insurance sector was the reduction in service tax charged on personal insurance. This wasn’t realized. Instead, the government selectively exempted service tax on general insurance services provided under ‘Nirmaya’ Health insurance scheme meant for the welfare of persons with Autism, cerebral palsy, multiple disability and retardation. A welcome move, again.

The Income tax slabs have not been changed in the budget. But this year, you can still save up to Rs 17000 tax u/s 80D on health insurance. To buy health insurance, just visit turtlemint.com 

Read more about Separate health insurance plans for parents of floater?

Read also An anatomy of an health insurance plan

Read more about Dejargonizing health insurance terms

For those who still think they can do without health insurance, let us set the record straight. The need to get health insurance is more than ever before. Health care cost is rising. It is actually rising by a whopping 19% every year, which, by the way,  is more than 3 times the inflation rate in our country. Understand it like this: Cost of cardiac treatment shot up by 2 lakh from 2007 to 2011 (about 137% rise) and further inflated by more than 60% in the last 3 years. Even if you can afford the occasional health expenses now, you have to just wait a few years to realize that you can’t. But what you can always afford is health insurance.  

Listing the many benefits of getting a health insurance plan is a beaten path and you should read more about it in our previous articles. The matter here is how to choose one health insurance policy out of so many choices available. Not all that easy a thing, but we proudly say we make it easy. Here you go.

Think and rethink your priorities

The first thing to do before you take an insurance plan is figure out your needs and priorities. This will require on your part to consider the benefits you expect from the policy. You will have to think in terms of your age, area of residence, family size, illness history etc. In terms of policy structure, you should assess which limits are acceptable and which are not. You may have an issue with an associated co-pay, some may not have. You don’t want a policy with room rent limit, others may be willing to adjust on that. All this can be easily done if you have the policy features neatly listed out for you.

Mind Your Budget

Once you know the kind of policy you have to buy, decide a budget. This essentially means knowing how much money you can fork out. Of course, this decision is central to the amount of cover you want to opt for. With regards to pricing, a family floater plan costs much less than individual plans.

Read more about family floater plan and individual policy

More than the premium to be paid now, you should think of what the cost of hospitalization in a good city hospital will be. Bear in mind that it can go as high as several lakh rupees. A higher cover amount will increase your premium by a few thousand rupees but will save you from bankruptcy in case you are hospitalized for anything serious.

How to get the Perfect Match

After zeroing in on the budget, you will certainly find a policy that fits the bill. Except that, you will find a number of policies that come close to your expectations. This may make it difficult to arrive at a decision but it’s always nice to have options. Here you will use your customer discretion to sift out the good from the better. The insurers’ claim settlement ratio, rate of claim settlement, pricing of the product and network of hospitals and other data will help you eliminate the unwanted. As part of our motto to empower customers, this data is provided on the site. You just go through the motions and the perfect policy picks itself for you. No kidding!

Know the policy

You must enquire about the details of the product you plan to buy, as much as you can. Knowing the fine print is crucial to your understanding of the policy limits and advantages. It is always good to be sure than be under some impression. And why not? When your policy details are so simply and clearly explained, there is no reason to stay unaware.Visit our health insurance page to compare and buy policies

Read more about Separate health insurance plans for parents or floater?

Read also An anatomy of an health insurance plan

Read more about Dejargonizing health insurance terms

You buy a Health policy from an insurer A. A few months down the line you feel that services of the insurer A are not up to the mark and you want to discontinue the policy and get insured with some insurer B.

What do you do?

As per IRDA guidelines issued in 2011, every insurer has to offer the portability feature in all the policies. Portability simply means that you can change your insurer or your policy without losing the benefits gained on the policy you wish to discontinue with insurer A.

What benefits are retained?

Waiting Period: In the new policy, your waiting period for pre-existing diseases and other treatments with a mandatory waiting period will be shortened to the extent of time you’ve spent in the prior policy. This is good because your clock does not start all over again.

No Claim Bonus: Any no claim bonus you’ve earned for your cover will not be transferred to the new policy. You are however free to increase your cover in the new policy and you will have to pay the premium based on the higher cover amount.

Read more about No claim bonus

Conditions

-One can port a policy only at the time of renewal.
–The application for switching the insurer must be submitted at least 45 days prior to renewal.
-The policy was renewed without a break.

Other caveats

–Portability is not a guarantee. The insurer you want to shift to may refuse to insure you on grounds of high risk (If you’re old or have developed a serious medical condition) and bad claims history (New insurance company will not be happy to see a lot of claims in your policy).

-Every insurance company has its own variety of health insurance policies. If there is a lot of discrepancy in the old policy and the policy you’ve chosen, the insurer may reject your application. Indeed, it is advisable to go for a policy of comparable benefits.

–The new insurer is liable to cover you at least up to the sum insured under the old policy. However, the final cover amount will be subject to what is offered in the new policy. If you’re insured up to 3 lakh in your old policy and the minimum coverage in the new policy is 5 lakh, you can’t do anything about it. You’ve no choice but to get the 5 lakh cover and pay the premium as applicable under the higher sum.

–If the waiting period in the new policy is more than the old policy, the benefits will kick in only when the period lapses as per the new policy.

–If the sum insured is higher in the new policy, period exclusions will apply for the additional sum. Let’s assume you have served the complete waiting period of 3 years for pre-existing diseases in your old 2 lakh policy. You now switch to a new policy of cover amount 3 lakh and waiting period of 4 years for pre-existing diseases. Until you serve the 4 years waiting period in the new policy, you can’t claim the entire 3 lakh sum. For pre-existing diseases, the new insurer will cover you only up to 2 lakh. Only after 4 years will you be able to claim 3 lakh for pre-existing diseases.

Do let us know about about any queries you have regarding portability. We can also help you port your policy. Just give a call on our toll free no. 18002660101.

Read more about What is insurance and how does it works?

Read more about  An anatomy of an health insurance plan

Read more about Dejargonizing health insurance terms

P.S.- Featured image is courtesy of Economic Times.

The maternity benefit in a health policy covers the insured during childbirth. A lot of newlyweds tend to take a health policy with maternity cover keeping in mind this certain expense in the near future. But you need to know a few things before you get this cover.

Raed more about why newly wed couples should opt for maternity policy

Maternity benefit- what does it cover?

Depending on the given policy, the maternity benefit covers the following:

-Hospitalization expenses for both Cesarean and normal delivery

–New born cover that insures the baby up to a maximum of 90 days

-Pre and post natal expenses, which also include post pregnancy complications

Not many options

Maternity benefit is not a default feature of a Health Insurance policy. In fact, many insurance companies don’t offer this benefit at all, and when they do, it’s offered with some restrictions. Apollo Munich, Religare, L&T, Cigna are among the few insurers that club it with their regular health policies.

Waiting period is justified!

There are some caveats involved with maternity covers. One is that they come with waiting periods, varying usually between 36-48 months. There is no escaping this fact and it sounds logical from the insurer’s point of view as well.

Read more about should you delay buying maternity insurance

Cash limit

As it happens, there is a cap on the expenses. Even in policies with sum insured 15 lakh+, you’ll not get more than 50k for normal delivery and 1 lakh for Cesarean delivery. Typically, the benefits range between 20k to 40k. The policies didn’t cover the pre and post natal expenses before, which increasingly the new plans have started to offer. However, no plan in the market covers in vitro fertilisation, abortion and expenses related to termination of pregnancy.

Compare the cost

Since maternity cover comes with a waiting period, the incremental cost to take this cover may reduce the value of the benefit accrued. To put it simply, with premium going up every year and health cost inflation, what you are promised as part of this benefit will not have the same value as calculated at the start of the policy period.

Final word

The question that you would have to ask is whether or not maternity benefit alone should dictate your decision. Maternity is not a ‘probable’ event, it is a planned event. In that sense, it’s a benefit that will be claimed. So, in a nutshell, two things.

1. A premium policy sweetens the deal by offering a lot of benefits, of which maternity is just one. If you think you want all those benefits as well, totally go for it. But it makes little sense to opt for a premium policy JUST for the maternity benefit.
2. Maternity is a policy specific benefit and there are no two ways about it. You pick out policies with maternity benefit and see if overall they address your needs. There are health policies in the market that insure up to 15-25k, which won’t cover the cost entirely, but will ensure that your pocket doesn’t go too light!

Read also An anatomy of an health insurance plan

Read more about Dejargonizing health insurance terms