The average middle-class individuals who want to include health insurance in their portfolio, this post will guide in buying the right health plan.
By Rakesh Goyal
Health insurance is an essential part of one’s financial planning. For many reasons, including the rising medical treatment costs, it is a must-have thing. And, one can clearly understand the need of having a health plan with the fact that even government has taken strong initiatives for citizens who can’t afford to have health insurance with the introduction of the Ayushman Bharat Yojana (ABY) in 2018.
Notably, the cover under Ayushman Bharat Yojana plan is of Rs. 5 lakh for a year, and it is meant for the low-income group.
The average middle-class individuals who wants to include health insurance in their portfolio to protect themselves from being financially burdened in case of medical emergencies, this post will guide in buying the right health plan.
When looking for a perfect health plan, often the budget could be a constraint. And at the same time, one doesn’t want to end up being underinsured.
So, to get the right plan within your budget, one must first answer these questions:
a) Individual plan for every family member or Family Floater?
b) What will be the coverage or sum insured of a Health Plan
In case you are not sure about the type of plan you should buy, then go for a family floater, provided the members don’t require multiple times hospitalization in a year.
Also, in a case, where you can’t afford to invest premiums for multiple individual plans. Furthermore, when buying a family floater, it is good to have a different health plan for members of older age as that would increase the premium otherwise.
Ideally, having a cover of Rs. 5 lakh should be minimum for a family health plan. Because of the rising medical inflation, plus, if one of the members gets hospitalized, in which case utilizes the cover up to Rs.3 lakhs, then at least Rs.2 lakhs would still be there for other members in a year.
What if you could not go for a higher sum insured due to budget or want to increase higher cover in a pocket-friendly way?
The answer is to opt for a top-up or super top-up plan. By opting for a top-up or a super top-up plan, you can increase the cover even with a small investment.
When you’ve decided the cover and the type plans, one can check various plans offered by different insurers. Comparing various health plans and their premiums offered by different insurers would give you a fair idea about plans and their other features, including their coverages and exclusions.
Before you finalize and buy a health plan, keep these things in mind:
A) Inclusions: Coverages or Inclusions is the list of all the things that your plan will cover under certain cases. Be sure to check what it covers: the type of treatments, cost of hospitalization, pre- and post- hospitalization, in-patient treatment, other treatment options, daycare list, etc. Each health plan may differ in their coverage scheme.
B) Room rent limit: The room rent is basically the cost of allowed room cost when hospitalized. Often, the room rent limit is missed when buying a plan, and opting a wrong room at the time of hospitalization, may cause in the partial claim settlement amount. In the case where the room opted has a higher rent than the mentioned limit, chances are the claim would be of a lower claim amount as proportionate to the mentioned rent limit.
Since, all the medical expenses, including the doctor’s fee, vary with the room chosen during hospitalization, better to go for the room as mentioned in the policy. And, at the time of buying, ensure that you choose the right room rent limit.
C) Waiting period: In the case of pre-existing diseases, there’s a clause of a waiting period. Usually, a plan may have a waiting period of 30 days before a claim can be filed. The waiting period varies for pre-existing diseases before they are accepted under the plan coverages. This again varies from insurer to insurer, so do check the waiting period under each plan. As you may prefer to have a lower waiting period health plan.
D) Exclusions: When buying a health plan, it is equally important to see what is not covered by a certain plan as important it is to check what is covered. Knowing exclusions will help in knowing which treatments are not covered.
E) Claim Incurred Ratio: It is advisable to know the claim incurred ratio of the insurers to make sure your claims get approved, provided the claims are genuine and as per the policy wordings.
There are other factors that you should also check before finalizing, for instance, Network Hospitals, Sub-limits, Co-pay, No Claim Bonus, Reinstatement, Renewability, etc.
Bonus Tip: Be transparent when buying a health plan and disclose all the details, because you don’t want to end up with your claims being rejected when needed due to any missing or false information.
(The author is Director, Probus Insurance Brokers)