We plan and save financially for our vacations, new gadgets, vehicles, higher education – even life insurance, however when it comes to medical expenses, not many are keen to allocate money for something that “may or may not happen”.
However, bear in mind that if illnesses and medical emergencies do occur, the resulting expenses could leave a HUGE dent in your savings.What you need is a health insurance policy that will safeguard you and avoid draining your financial resources.
So when should you get a health insurance policy?
Ideally, as soon as you start earning. At a young age, and usually without any pre-existing diseases, the premium is the lowest, even more so when bought online. A delay of 5-10 years can cause the premium to go up 1.5-2 times or more.
Which is the best health insurance policy?
Much as we all would like to take a policy which has every possible feature and benefit we want at the lowest possible premium, such policies don’t exist and there is always a trade-off one way or another. You have to take the policy that you feel suits your requirement the best, based on the following factors;
Individual v/s Family Floater v/s Company Cover
- If you’re single with no dependents, an individual cover works best. Ensure the policy covers ailments/diseases keeping your lifestyle and family history in mind, as well as the nature of your job
- A family floater is useful once you have dependents because
– The premium is cheaper than buying individual policies for all
– Entire sum assured is available even if one person has to avail of it (subject to clauses and limits for each treatment)
– If you’re the first member, your age and medical history determines premium and acceptance
– If you have a pre-existing disease, you’re better off with an individual policy for yourself and a separate one for the family
- Most companies nowadays offer a group accident / health insurance cover. While it is good to have one, always ensure it is not the ONLY one – get a separate personal one too. Previously, the cover expired on leaving a company; however since the past few years, insurance companies have been willing to transfer a company policy to a personal policy.
Exclusions and sub-limits
- Pre-existing diseases are usually not covered for 24-48 months from the policy date
- Some insurers may not even issue a policy depending on the nature of the pre-existing disease
- Most policies also have a waiting period (30-90 days) from start date
- Check which ailments and procedures are not covered by your policy to avoid any problems at the time of hospitalisation or claim
- Sub-limits are usually assigned to various expense heads from room rent, OT / ICU charges, nursing, medicines etc, to charges for specific medical procedures and surgeries, irrespective of your overall insurance cover
- Co-payment involves sharing the overall cost of the claim with the insurer in a pre-decided percentage (usually 30:70, 20:80)
- This clause is mostly present in health insurance for senior citizens as the risk is also higher
Hospital Network and TPA
- When choosing a policy, check the list of network hospitals and confirm if hospitals near your home / providing any specialised treatment you need are part of the insurer’s network
- Network hospitals provide a cashless benefit, which means once cost estimate is approved, the insurer pays all the hospital bills (except maybe a small percentage towards consumables and such)
- If not part of the network, you will have to make all payments upfront and submit the claim to your insurer for reimbursement, which can be a financial burden
- A third-party administrator (TPA) acts as a facilitator or a go-between, and can sometimes cause needless delays. Try to select an insurer who has in-house settlement options
No-claim bonus, recharge facility
- If no claim is made during a year, a no-claim bonus is added to the policy sum assured; percentage depends on the policy
- Several insurers offer a recharge facility wherein the basic sum assured is restored or recharged. Even if you make a claim during the year, the basic coverage amount is made available again if there is another hospitalisation in the same year
- However, it may not be applicable for the same ailment/procedure for which the previous claim was approved and paid
- Since the past 3-4 years, insurance companies now allow you to port or move your policy to another insurer if you’re not satisfied with the services or hospital network of the existing provider
- Ideally, this is best done at least a couple of months before the renewal is due
Forewarned is forearmed
Always read the clauses thoroughly before choosing a policy and even during the look-in period after the policy is issued. Be truthful in declaring any lifestyle habits and pre-existing diseases. Having a claim rejected because you didn’t read the clauses carefully or were untruthful is simply not worth it.
Now, track your expenses and pending bills without any user input. Split and settle expenses with your friends over chat, export your data, get insurance premium payment reminders – all this is auto-magically possible with Walnut. Never miss a premium payment again!