Financial planners often advise individuals to set apart at least six months of their earnings as an emergency fund in order to meet unforeseen expenses such as sudden hospitalisation, loss of jobs, etc. Such a fund is generally maintained in cash at home or in a savings bank account, which earns an interest of around 3.5%.
As a means to add value to investment services, mutual fund houses from time to time come up with novel ideas like life insurance cover linked to one’s Systematic Investment Plans (SIP) and others. On the same lines, most of the major MF schemes provided by ICICI Prudential Mutual Fund have a novel feature, called Medical Advantage Feature (MAF), which is designed to address the financial needs during times of hospitalization. This is interesting because arranging funds in times of emergency hospitalisation is a hassle which most often investors live through.
Features of the Scheme
In order to offer this service, ICICI Prudential Mutual Fund has a tie-up with Vidal Healthcare Services, a third party health management and services company, to provide certain value added services to the investors of the mutual fund house. For all practical purposes, Vidal works like Third Party Administrator (TPA).
The services rendered by Vidal are through its pan-India network coverage of more than 5000 hospitals, 1000 diagnostic centres and doctors, spread over 125 cities. Under the MAF facility, an investor with ICICI Prudential Mutual Fund gets cashless hospitalization facility through their investments made in selected schemes with the fund house. So, with cashless hospitalisation against one’s investment, there is no need to worry about arranging money for hospitalisation as long as value of the investments made is sufficient to address the expected cost of treatment.
In addition to cashless facility, there are a slew of free facilities that one can avail. Under MAF, one has access to doctors on helpline no. 080 49101010, such that a health query can be addressed. Also, one has the option of seeking second opinion on submission of one’s medical reports. The other benefit is that the investor can avail discount of up to 25% in selective hospitals, diagnostic centre and pharmacies. There is a dedicated helpline number to aid investors to access the closest network hospital in case of an emergency and avail discounts, if any. The highlight of these offerings is that all of the above-listed benefits are free. So, one can avail these facilities free of cost, without making any hole in your pocket or even in your investments with the fund house. Please note that the MAF enrolment does not stop an investor from redeeming one’s investment for other requirement.
Who can avail these benefits?
MAF can be availed by an existing as well as a new investor. Currently, MAF is available across 45 schemes covering all categories ranging from liquid funds, short term funds to equity funds. This facility is available on direct and regular plans as well as growth and dividend options of the specified eligible scheme. You can avail this against your SIP or lump sum investments.
Under this facility, an investor can cover one’s family members like spouse, parents, in-laws and two dependent children. While filling the form, it is advisable to make investments in either or survivor mode so that any of the holders can transact in the scheme in case a need arises. Apart from individuals, companies too can nominate and enrol their employees for availing this facility against investments made by them.
How MAF functions
For availing these facilities, one has to opt for MAF while making one’s investments. Once registered, a Medical Advantage Card is issued by Service Provider either in physical or electronic form. This is sent to one’s registered address mentioned in the folio.
At the time of hospitalisation (planned/unplanned), the investor has to inform Vidal Health in order to avail cashless facility at a network hospital. Post intimation, one has to sign a special redemption form, called medical redemption, which will be made available at the hospital. Here, based on initial estimate given by the hospital, the service provider redeems some units immediately, while some more units are earmarked/ blocked for subsequent payment. The proceeds of redemption are then credited to the service provider who pays to the hospital.
Please remember while applying for the redemption request, one has to keep in handy documents such as the Medical Advantage Card issued and other identification papers as listed by the service provider. In special circumstances, if the investor is not in a condition to sign the redemption form, the same can be signed on his/her behalf by Vidal Health.
MAF is not an insurance scheme to cover cost of your hospitalisation, but a facility extended by ICICI Prudential Mutual Fund to utilise the money invested in their schemes to meet hospitalization expenses. As a result, the investments in selected schemes can double up as your emergency fund as well, instead of keeping cash at home or even in a savings bank account. Also, this facility can come in very handy in case of any medical emergency, while on a vacation, away from one’s home, thereby making it a very attractive proposition.
(By Balwant Jain. The author is a tax and investment expert and can be reached on email@example.com)