For those stuck with a lower sum insured health insurance policy, porting is the only and most affordable solution available.
Distressing tales of people infected with COVID-19 paying exorbitant hospital bills for the treatment of the novel coronavirus have been surfacing all over for quite some time now. Recently, a 44-year-old Delhi resident – Rakesh Bakshi — who was admitted to a plush private hospital in the national capital for treatment of COVID-19 was charged over Rs 23 lakh for 21 days of hospitalization. What’s more, his health insurance claim was for just around Rs 10 lakh and he had to pay the remaining amount from his own pocket for which he had to ask for help from family and friends.
Rakesh was lucky that he had health insurance that covered him to some extent, though the cover was not sufficient to pay for the entire hospitalization cost. While people do opt for a health insurance policy, not everyone opts for the right coverage amount or the sum insured which often lands him or her in a deep financial crisis.
Insurance experts address health insurance with an inadequate sum insured as a ‘leaking bucket.’ While you may feel you are financially well protected against any medical emergency, due to the lower sum insured, the core objective of health insurance is not delivered. Even at times, people with inadequate health insurance coverage have to sell-off their financial assets, or even worse, borrow money at a massive interest rate to pay for the hospital bills. To support this, there is a recent report by ‘Ayushman Bharat’ that states – In India, over six crore people every year i.e. roughly 7,000 people every hour, slip into poverty due to catastrophic healthcare expenses. This is also because India, which is ranked amongst some of the biggest economies across the globe – 70% of the public healthcare in India is supported by the private sector and only 30% by the public sector.
This means, in case a medical emergency strikes a family, a majority of times the person needs to be rushed to a private facility for treatment. And then, private hospitals charge a hefty amount even for minor treatment, and hence it is important to have a health insurance policy with a high sum insured.
With hospital bills running into lakhs for hospitalization of a single-family member due to COVID-19, two or three members of the same family being hospitalized can turn to be a shocking nightmare – both physically and financially. While you may avoid this situation by maintaining social distancing and following government mandated protocols, it is equally important to stay financially prepared for any such situation and the only way out is having a health insurance cover with adequate coverage – sum insured.
For those unaware, the sum insured is the total amount up to which the insurer promises to pay your hospitalization bills. In case you and your family members are already covered under a group health insurance policy or individual health covers with Rs 5 – Rs 10 lakh sum insured, do note the cover is not enough considering the current medical inflation rate and the high-rising treatment costs. The first thing to do is to enhance the sum insured of your health cover to Rs 40 lakh or if possible, Rs 1 crore. Today, a Rs 1 crore health insurance policy for a 32-year old individual is available at the same price as a Rs 10 lakh sum insured plan.
You have the option of either enhancing your sum insured with the current insurer or if your current insurer does not offer a higher sum insured policy, you can port your policy to a different and better insurer. For those stuck with a lower sum insured health insurance policy, porting is the only and most affordable solution available. It is always better to port your health insurance policy rather than buying a fresh policy all together as you may lose all the benefits attached with your previous health cover. By buying a fresh policy, you will loose on the No-Claim Bonus benefit and will have to serve a fresh waiting period on various pre-existing conditions.
There are numerous insurers available in the market that are offering health policies worth Rs 1 crore for premiums as low as Rs 600 – Rs 800 per month for a 32-year old individual. In fact, for an annual premium worth Rs 15,000, you can get a cover with Rs 1 crore sum insured for a family of four – Self, Spouse, and two-Kids. Porting your health policy to a higher cover plan will not only enhance the coverage but also help you avail a plethora of exclusive features like no room-rent capping, no co-payment clause, and no sub-limits on specialized procedures. In fact, many insurers also allow you to earn wellness points while maintaining your health as per the program and redeem the points for discounts on premiums or get a membership for yoga centres and gyms.
With the intervention of the insurance regulator, for the benefit of customers, the porting process has been made very smooth and you can easily switch your insurer online if you are unhappy with the current insurer and wish to port to a better policy. By following a few simple steps, you can port from one insurer to another. With the several changes in the underwriting rules, customers do not need to serve a fresh waiting period when porting the insurer and also all other benefits like No-Claim Bonus continue to work without any break. In fact, when porting to a new insurer, you also have access to features like no room-renting capping, zero co-payment and no sub-limits.
(By Amit Chhabra, Head-Health Insurance, Policybazaar.com)