Almost all general insurance companies and standalone health insurance companies have tie-ups with one or more banks to promote their products. Apart from bancassurance, banks also take group insurance cover for its staff and customers, which may be availed by account holders by paying a nominal premium – much less than the premium amount of personal health insurance policies.
Not only lower premium, but such group health insurance policies also offer some additional benefits like maternity cover, lower or no waiting period etc. So, definitely such group policies look lucrative in comparison to a personal health insurance cover.
But wait, inspect the terms and conditions carefully before you rush to replace your personal health insurance cover with the cheaper group policy offered by your banker.
This is because, the group health covers have the following demerits over personal health insurance cover:
Not a permanent cover
You may avail the benefits of such a group insurance cover as long as you are a customer of the bank. If you change your bank, you will lose the cover. Even if the bank ends contract with the insurer, you will lose your cover.
No claim bonus not available
Unlike personal health insurance policy, where you get a bonus either in the form of lower premium or as an additional cover over the basic sum insured for every claim-free year, there will be no such benefits for group cover. The enhanced bonus cover acquired during the disease-free years may prove very beneficial at the time of hospitalisation, when you fall sick.
No life-long renewal
The greatest demerit of the group health cover provided by the banks is that almost all such covers may be renewed up to a certain age, say 80 years. So, during the old age, when you would need the medical care most, you may be left out in the cold with no health insurance cover.
Moreover, at old age, you may get only limited cover and that too with several clauses that would enhance your out-of-pocket expenses even if the cost of hospitalisation is within the limit of insurance cover.
So, don’t go for the cheaper premium, but evaluate the usefulness of the health cover when you need it the most.
You may take the group cover along with your personal health insurance policy as an additional cover to enjoy the extra benefits like maternity cover without much waiting period, if needed. But you can’t completely depend on such group cover and taking personal health insurance policy for yourself and your family is a must.