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Policies with the lowest premium or those with a basket of benefits may not always be the best option for you. Here’s how you can make an informed choice.
If you knew that getting medical bills reimbursed from your insurer is likely to fetch you half the sum compared to a cashless claim settlement, it is unlikely that you will opt for the former. But when it comes to selecting a policy, buyers often forget to keep such crucial facts in mind. So, here’s a checklist you need to tick before you buy health insurance.
Your requirements
The type of health insurance policy you need may not be the same as that of your neighbour. Your policy should be determined by your family’s needs. The number of family members and their age is crucial to identifying a policy. For instance, a young family can do with a basic cover of `5 lakh, while a family with senior citizens should opt for a larger floater cover, say experts. If the parents are too old, it may be prudent to get a separate cover for them, and not include them in the floater plan. Then, you need to be careful when opting for a maternity cover as part of your health insurance policy. If you are planning a baby within two years’ time, you will be better off without the maternity cover which comes with a long waiting period and almost doubles the policy premium.
Limitations and exclusions
Once you have shortlisted policies based on your specific requirement, go through the fine print to understand the limitation and exclusions of the plans. Most basic plans carry sub-limits for specific treatments. For instance, hospital room rent restrictions. Ordinarily, a `5-lakh cover could restrict the daily room rent to 1% of the sum insured. Currently, this may get you a private room, unless you insist on high-end corporate hospitals, and you need not stretch your resources to buy a premium variant, without a room rent sub limit.
“However, if you prefer access to high-end hospitals with better rooms, then plans with room rent sub-limits will not work for you,“ says Arvind Laddha, CEO, Vantage Insurance Brokers. Also, given healthcare inflation, a few years from now, these room rent sublimits may not even suffice for the not so high-end hospitals. “With such restrictions, it will become increasingly difficult to get private rooms. All the other expenses are linked to room rent eligibility, bringing down your entire claim eligibility,“ says Mahavir Chopra, Director, Health Insurance and Personal Accident, Coverfox.com.
Premium and plans
Experts say one should neither focus on buying the cheapest policy nor one that offers a plethora of benefits. The emphasis should simply be on whether a policy fulfils your requirements. Several health insurers have come out with premium variants that offer services like doctors’ second opinion, vaccination cover, wellness benefits, etc. “Paying higher premiums for benefits you may never use is not advisable,“ says Laddha. Also, it is not advisable to buy a high-end cover merely for availing tax benefits. You can always invest in other tax-saving schemes that offer greater rewards.
Cashless hospital network
According to the Insurance Regulatory and Development Authority of India, the average claim payout in case of reimbursement settlements is just half that of cashless claim disbursals for the same ailment category. Even though insurers dispute this, you must find out about an insurer’s network of hospitals that offer cashless claim settlement. The information is usually available on the insurer’s website.“Taking the reimbursement route could strain your finances and, in extreme cases, even impact the quality of treatment you choose,“ says Laddha. Opting for the cashless facility also saves you the trouble of collating all the documents, submitting them to the insurer and following up.
Insurer’s track record
An insurer’s experience, financial strength and service record is also crucial. “An insurer with a lower claim settlement ratio may spell trouble,“ says Laddha. If possible, you also need to take into account solvency margins--an insurer’s ability to pay out claims--and premium growth registered by insurers. The number of years an insurance company has been in business is also worth considering. “Its expertise in health insurance will be reflected in the types of policies. An insurer with a wider range of products may be a better choice,“ adds Laddha.
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