Concept of Room Rent Limit in Health Insurance & Why you Should Stick to It?

Health Insurance in a larger perspective has a lot to talk about; however, there are certain aspects that need a lot of clarification. One of these aspects is room rent. Based on the recently published data of the insurance industry, the number of customer complaints against health insurance companies has increased significantly on basis of dissatisfaction with claim settlement. The primary reason for this is the room rent sub-limit feature in health insurance policies. Let’s read further to understand what the sub-limit of room rent is and why you should have proper knowledge of it before purchasing a health insurance policy.

Read More

Get ₹5 Lac Health Insurance starts @ ₹200/month*
Get ₹5 Lac Health Insurance starts @ ₹200/month*
250+ Plans 18 Insurance Companies
₹ 5 Lakh Coverage @ ₹ 10/day
7 Lakh+ Happy Customers

*All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply
*Tax benefit is subject to changes in tax laws. Standard T&C Apply

Get insured from the comfort of your home No medicals required
I am a

My name is

My number is

By clicking on 'View Plans' you, agreed to our Privacy Policy and Terms of use
Close
Back
I am a

My name is

My number is

Select Age

City Living in

    Popular Cities

    Do you take any daily medication? Apart from vitamins & supplements
    Get updates on WhatsApp

    What are Sub-limits?

    Sub-limits refer to a specific percentage of the sum insured amount that the insurance company will bear for different hospital expenses. The bill amount is supposed to be paid by the policyholder. It is important to keep in mind that the sub-limit in health insurance does not apply to the whole bill amount. Surgery/operation charges, doctor’s fees, medicine cost, nursing expense, and room rent all have a sub-limit applied cap applied to it. For example, the sub-limit on room rent can be capped at 1% of the sum insured and thus for coverage of Rs 1 Lakh the room-rent will be limited to Rs 1,000.

    You May Like to Read: Best Health Insurance in India

    How Does Room Rent work in Health Insurance Policy?

    Room rent is the per-day room or bed charges the hospital charges the patient to pay. With the health insurance policy, the room rent expenses of the policyholder are settled by the insurer.

    • Case Study

      If the policyholder's room rent is Rs.2,000 per day then the other charges like a doctor visit, nursing, and other diagnostic charges are respectively to the room rent. Similarly, if the policyholder chooses a private deluxe suite for Rs.8,000 per day then the other medical charges and expenditure increase respectively to the room rent. Thus, it is always advised to purchase the policy with no room-rent sub-limits.

      There are mainly four types of room rent coverage in the health insurance policy.

      • Room rent without sub-limits
      • Room rent with co-payments
      • Room rent without sub-limits as an add-on cover
      • Room rent with specified room types

    Importance of Room Rent Sub-limit

    The sub-limit on room rent is very important as far as the claim is concerned. In most of the health insurance plans, the limit on reimbursement of the claim for all the other medical cost is related to the room-rent limit. Thus, it is always advised to the policyholder to always stick to the room rent limit. If the health insurance policy sum insured amount is Rs. 3 lakh, then it is advised to select a hospital room with the rent amount equal to 1% of the sum insured i.e. Rs 3,000 per day.

    Effect of Exceeding the Sub-limit

    Not sticking to the room rent sub-limit has a negative impact on the total claim settled by the insurance company. If the policyholder exceeds the room-rent limit then the insurance company respectively reduced by the reimbursement sub-limits related to the other medical expenses. Based on the room types selected by the insured, different hospitals have different billing and room rent.

    The sub-limits for reimbursement of related medical expenses are decreased in the same proportion as the room -rent exceeds the permitted limit. So if the policyholder exceeds the room-rent limit by 33% by choosing a room which cost Rs 4,000 per day instead of choosing the mandate room which cost Rs 3,000 per day, the reimbursement sub-limits for all the other claims also get reduced by an equal percentage. In this case, the insurance company pays the partial payment of the claim and the rest of the balance expenses are needed to be taken care of by the policyholder from his/her pocket. This results into dissatisfaction and customer grievance.

    You May Like to Read: Mediclaim Policy for Senior Citizens

    What to Do?

    During hospitalization, sort out the connection between the room-rent limit and other expenses. Ask whether the third-party administration is available to the insurer itself or at the hospital. If the other expenses and room rent sub-limit is connected then it is better to stick to a room with the rent within the permitted sub-limit.

    Plans without Sub-limits

    There are some of the health insurance policies, which do not offer any sub-limit or any other medical expenses including the room-rent. Select the plan, which does not come with the sub-limit clause even though the premium amount of the policy can be higher. The benefits offered by such policies are even higher. Some of the health insurance plans also offer the option to remove the sub-limit clause by paying some extra premium.

    The Final Verdict!

    Even though most of the health insurance policy clearly states different sub-limits in the brochures, the important equal reduction of the claim amount clause is generally mentioned only in the policy document. Thus, for a good customer experience and to avoid partial settlement of the claim it is always advisable to stock to room rent sub-limit or opts for a health insurance policy without sub-limits.

    Written By: PolicyBazaar - Updated: 23 July 2021
    Search
    Disclaimer: Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.

    You May Also Want to Know About

    Top Maternity Insurance Plans

    Top Maternity Insurance Plans

    Top Maternity Insurance Plans Maternity or pregnancy is an important phase of life, and one needs to prepare in advance to embrace parenthood. Though rearing a child is an expensive affair and may require good financial backup to meet the requiremen...
    Health Insurance Claims Ratio- Things You Should Look Before Buying Health Insurance

    Health Insurance Claims Ratio- Things You Should Look Before Buying Health Insurance

    There has always been a doubt in customers mind about whether the private company will keep its side of the bargain i.e. it will settle the claim or not. A customer spends premium annually which will cover his medical expenses but there’s always ...
    Best Health Insurance Plans for Senior Citizens in 2021

    Best Health Insurance Plans for Senior Citizens in 2021

    Best Health Insurance Plans for Senior Citizens in 2021 Considering the increasing percentage of medical inflation in India, it has become an absolute necessity to buy adequate health insurance for your loved ones. And if they are your elderly pare...
    Covaxin vs. Covishield vs. Sputnik vs. Pfizer: Which one should you get?

    Covaxin vs. Covishield vs. Sputnik vs. Pfizer: Which one should you get?

    Covaxin vs. Covishield vs. Sputnik vs. Pfizer: Which one should you get? Covaxin vs. Covishield vs. Sputnik vs. Pfizer, the speculation continues regarding the difference between the efficacies of these COVID-19 Vaccines against the Coronavirus. If...
    Here’s the Difference between Health Insurance and Mediclaim

    Here’s the Difference between Health Insurance and Mediclaim

    Here’s the Difference between Health Insurance and Mediclaim Imagine you’re looking for a job change. You get an interview call for a job. What will be your plan of action? Will you get your resume ready and prepare for the interview or you wi...
    Close
    Download the Policybazaar app
    to manage all your insurance needs.
    INSTALL