1. Health insurance: 10 tips to keep in mind before buying

Health insurance: 10 tips to keep in mind before buying

The 10 rules to keep in mind when you buy health Insurance –

New Delhi | Published: April 23, 2015 4:16 PM
health insurance, insurance, insurance tips, health insurance tips, health insurance importance, health insurance plans, health insurance for family, business news

Choosing the right health insurance plan for you and your family is a serious decision as health is the only true wealth and it provides you peace of mind and sense of security. (Thinkstock)

Choosing the right health insurance plan for you and your family is a serious decision as health is the only true wealth and it provides you peace of mind and sense of security not only for yourself but for your family too. It assures you that you can always offer them the best chance of getting well just in case anything goes wrong.

Many of us buy health insurance with the sole objective of saving tax but fail to consider the importance of buying a comprehensive medical insurance plan. More than 80 percent of financial crisis originate out of a medical emergency and the same can severely damage one’s finances. Health emergency will not only require funds for treatment but for most of us will also hurt our ability to earn thus hitting us with a double impact. Imagine losing a family member because you cannot afford to give him the best medical treatment. So health insurance is a must today.

With increasing healthcare costs, the reason to get health protection as early as possible is gaining importance because once we get some issues like BP, Diabetes the chances of getting a health cover go low and the cost goes high. There’s nothing more satisfying than to pay a small price and get peace of mind.

The 10 rules to keep in mind when you buy health Insurance –

Tip 1 – You must have an individual health insurance even if your company offers you a corporate group health cover. There could be a possibility that your corporate cover will cease once you leave your job or retire and the company may also decide to withdraw this benefit or choose to leave other family members out of the coverage. If one is suffering from a chronic disease, this becomes more important. You can even take a Super Top up if you can’t afford a full individual Medicalim.

Tip 2 – Choose the right amount as ‘sum insured – While selecting a Sum Insured you need to keep the today’s costs in mind. If you are the one who is putting in a small city then your aim of cover should at least be ranging from Rs.3 to 5 lakh whereas if you live in a metropolitan than your cover should not fall anywhere less than Rs. 5 – 10 lakh. Also, you can move from one insurer to another through porting. Don’t buy a new plan but instead port your plan. With porting your benefits which have been already accumulated in the old plan gets transferred to the new plan. Also remember to keep on increasing your health cover from time to time to take care of the medical inflation.

Tip 3 – Get early protection – Buy a health cover as early in life as possible and definitely before you turn 40. As you are likely to make no or few claims in earlier stages of life, you can get the benefit of no-claims bonus and add up to the original coverage every claim-free year.

Tip 4 – Buy only a health cover which gives you lifetime renewability. Your aim is to have a health cover at older ages when you will have ailments and that protection is possible only if your policy offers lifetime renewability.

Tip 5 – Never buy a health insurance policy which has a claim loading – if you get a critical illness which requires long term cure then with a claim loading your premiums will keep on increasing and soon may become un-affordable. So don’t fall into that trap.

Tip 6 – Buy a policy which gives you a restore limit or super top up just in case you fully utilize your sum assured. This will act as a buffer to cover some unforeseen critical illness which may be very costly to manage like cancer etc. For example a Rs 5 lakh plan with a Rs 5 lakh restore limit almost gives you Rs 10 lakh cover for critical illness at no extra cost.

Tip 7 – Always buy your insurance through a reputed insurance broker with an ability to help you with claims. Remember if you are having a heart attack or have an accident you won’t be in a position to do it yourself or fight the insurer if your claim is rejected without proper justification. Never buy direct and never never buy online. You can use online to select a plan or study features but only buy the health cover though an entity which according to you has the ability to help you with the claim.

Tip 8 – Never lie and hide information in you application form. If you have an ailment please make sure you mention it. Get the broker to help you get a plan which will cover the ailment even after a waiting period. Today in most the plans all preexisting diseases also get covered after 3 to 5 years depending upon the plan.

Tip 9 – Waiting Periods – All health plans have a waiting period for pre-existing ailments. Please see what is the waiting period in the plan that has been suggested to you. Waiting period generally extends from 2-5 years varying from company to company. It is always advisable to opt for a company that offers minimum waiting period. Also there are some companies which offer you coverages with lifetime exclusions. Exclude such companies from your options.

Tip 10 – Buy a plan with no or minimal sub limit. Be especially careful of plans which offer a cap on room rate. You can’t decide the category of the room if you or your family member is carried in an emergency situation to the hospital. Watch out for Sub limits. Sub-limits means that your insurer specifies a limit for an expense and anything above that needs to be borne by you, Room rent, diagnostics and doctor’s fees are the most commonly introduced sub-limits. You need to check the limits while choosing a policy.

Some small additional things that you must keep in mind. Make a list of preferred hospitals where you will like to be cured. Does the plan offer cashless in those hospitals and are those hospitals  covered in the insurers list of network hospitals. The reason I have not put this in the main rules is because as of today most of the insurers covers most of the good hospitals, so this should not be a major challenge.

I wish that by following the above rules you are able to choose the best policy and offer the best of life to yourself and your family.

By Sanjiv Bajaj- MD, Bajaj Capital

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  1. Ishika M
    Jan 14, 2016 at 9:26 am
    Nicely written and good piece of information provided. Every insurance company has its own underwriting policy basis on which it calculates the premium. The important factors it considers while calculating are the average age of the family members, pre-existing diseases and the sum insured. The lower the average age of the family, the lower are the premiums because the insured family is considered less likely to file claims and therefore are presumed to be less risky. Premiums increase with increase in average age. You can also check one more website which has similar kind of information
    Reply
    1. S
      siva
      Oct 20, 2016 at 1:29 pm
      thanq very much sir
      Reply
      1. S
        Srinu
        Oct 3, 2016 at 9:30 am
        Thanks, for your post! It's really helpful.Please advise some list of reputed brokers of health insurance in Hyderabad. As you suggested the valid point don't buy it from online.
        Reply
        1. J
          June Robinson
          Nov 23, 2015 at 8:35 pm
          I really appreciate this information on how to buy health insurance. I like that you point out the importance of having early protection. That way, you'll be able to receive coverage the longer you stay healthy. Thanks for the information!
          Reply
          1. Manish JOshi
            Apr 24, 2015 at 11:17 am
            A very thorough and informative article. Especially agree with point#3 the sooner a health insurance is bought the better. Have had the unfortunate experience of being in the situation myself. However not so sure on point point#7 - never by insurance online. Is not the final fulfillment done by the respective insurance company, then what would be the issues that can arrise. Also wanted to know that similar to the term insurance plan described here is there something similar in case of health insurance. Would it not be beneficial for someone that is working in a hazardous environment and more likely to fall sick, in this case a lower premium for a 'health term insurance' type of policy would be advantageous - as it would require lower premium payments. Your thoughts would be much appreciated.
            Reply
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