15 Must Know Health Insurance Terminologies in India

The prospect of hospitalization due to the Coronavirus pandemic and expensive treatments in private hospitals have driven more Indians to sign up for health insurance cover. We see a shuffle, albeit temporary, in the pecking order of portfolios of health insurance companies.

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      If you are buying a health insurance plan, you will come across plans in India with several quotations. These documents hold vital information in terms of the policy coverage, and criteria. And you would need to go through these documents and understand every term to assess the financial protection and coverage offered.

      Still, some of the terminologies in health insurance plans can be difficult to understand. With proper comprehension of health insurance details, you can save yourself from serious mistakes. Failure to do so could mean compromising with your sum insured during hospitalization.  

      But before you decide the right health cover for you and your family there are a few important health insurance terms that you should be familiar with. Prior knowledge of the ABCs of health insurance like Aggregate deductibles, premiums, claims, and co-payments are becoming more and more important for insurance buyers.  

      Here are 15 important terms in health insurance plans in India that could motivate you to go ahead and buy the right insurance policy. Read on to know more:

      1.Add-on Covers/Riders/Optional Covers Add-ons covers in health insurance are additional features also termed as optional covers or riders. This is an additional feature in health insurance that offers additional financial cover against unknown medical emergencies involving higher medical costs.  

      Some of the add-on/optional covers that you can choose to enhance your base health insurance plan are critical illness cover, maternity cover; room rent waiver, hospital cash benefit, etc.

      2. Automatic Restoration: Nowadays most health insurance plans offer 'restoration benefit'. You get a 'financial backup' to recover your exhausted sum insured. In the event the entire sum insured is exhausted, it gets reloaded automatically for the next hospitalization during the policy term.

      3. Co-morbidities/Pre-existing Diseases: Health comorbidities like COPD, hypertension, diabetes, kidney problems, cardiovascular issues, and other underlying diseases are considered to be significant risk factors in terms of health insurance. Patients with pre-existing medical conditions as mentioned above are considered to be at a higher risk and are therefore charged a higher premium.

      4. Co-payment: some of the health insurance plans have a copayment or copay clause. It is a fixed percentage of amounts that the insured/policyholder has to pay to the insurance company before receiving the healthcare service. It is mentioned in the policy wordings, e.g. people above the age of 60 years have to pay 20% co-pay at the time of claim, for each time a medical service is availed.

      5. Critical Illness: Critical illnesses or life-threatening medical conditions refer to life-threatening medical conditions like cancer, kidney failure, and cardiovascular diseases. There are special medical insurance plans that cover these illnesses. Or you can get a rider or add-on cover for the same.

      6. Cashless Claims: It refers to health insurance claims filed for a medical treatment availed in the network hospitals. 

      7. Deductibles: It is very important to understand the deductibles in health insurance. Deductibles can reduce your policy premium, but at the same time, it can mean that you have to pay a fixed sum at the time of insurance claim. So, do check the policy documents for the deductible clause and choose the one that does not include it, until you are ready to bear the treatment cost.

      8. Exclusions: Exclusions are also termed as the limitations. The health insurance companies usually mention them on their site and in policy wordings clearly. These are the conditions and circumstances under which your health insurance claims can get rejected and will not be processed further.

      9. Inclusions: It is something that you really need to check. Coverage benefits or inclusions refer to the policy features and benefits that the insurer will compensate you for. It includes hospitalization expenses, ambulance charges, surgery, hospital room bills, anesthesia, medicines, and treatment-related expenses. 

      10 No-claim-bonus: Health insurers offer a unique proposition termed as No-Claim Bonus (NCB), whereby the policyholder is rewarded for not filing a claim in the preceding years. No-claim-discount around 20-100 percent can be earned by the policyholders for not making a health claim.

      11. Network Hospitals: Every health insurance company in our country has a tie-up with a certain number of hospitals called as the network hospitals. These are the hospitals where you can avail treatment without the need to pay the bills; the insurer settles the bill directly up to the coverage limit. Your insurer will be directly be bearing the cost. It is called as the cashless claim services.

      12. Premium: Health insurance premium refers to the amount that you need to pay the health insurance company against the policy purchased.  The premium depends on the policy type, the sum insured, age of the policyholder, and various other factors. Average, the premium for a policy of Rs 10 lakh will cost around a premium of Rs 8,000.

      13. Sum Insured: The policy coverage amount is termed as the sum insured. The insurer compensates an amount equal to the sum insured that can be from Rs 5 lakh to Rs 100 Crores.

      14. Top-up plans: These are the policies that you can buy along with your base policy. Once the sum insured of the base policy gets exhausted, your top-up plan will cover the cost of the treatment.

      15. Waiting Period: In a medical insurance policy, there is a fixed time-period before which you cannot avail the coverage benefits. During the waiting period, health insurance claims are not admitted. The waiting period for different health conditions and coverage varies.

      Bottom Line

      These were some of the healthcare buzzwords that will help you in shopping for the right health insurance policy. We think now you will agree that some knowledge beforehand will go a long way in and everything will start making sense. This will allow you to make smart decisions for yourself and your family, especially in terms of medical insurance.

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      *All the health insurance plans cover hospitalization expenses including COVID-19 treatment cover up to the specified limits. You can also buy specific COVID-19 health insurance policies such as Corona Kavach Policy and Corona Rakshak policy.

      **All savings and online discounts are provided by insurers as per IRDAI approved insurance plans. #Tax Benefits are subject to changes in tax laws. GST Exemptions depend on fulfilment of qualification criteria and submission of relevant documents.

      *₹1748/month is the starting price for a 1 crore health insurance for an 18-year-old male, with no pre-existing diseases. Discount on renewal premium is subject to the number of wellness points earned in the health insurance policy. For more details about the plans, please read the sale brochure carefully to get upto 100% discount on renewal premium.

      *₹400/month is the starting price for ₹ 5 lakh Health insurance for a 30 year old male & 29 years old female, living in Delhi with no pre-existing diseases

      *₹541/month is the starting price for ₹ 10 lakh Health insurance for a 30 year old male & 29 years old female, living in Delhi with no pre-existing diseases

      *₹762/month is the starting price for ₹ 1 Crore Health insurance for a 30 year old male & 29 years old female, living in Delhi with no pre-existing diseases

      *₹243/month(₹ 8/day) is the starting price for a 5 lakh health insurance for a 20-year-old male, non-smoker, living in Bengaluru with no pre-existing diseases

      *₹2020/month is the starting price for ₹ 1 Cr Health insurance for a 50 year old male & 50 years old female, living in Bangalore with no pre-existing diseases rounded off to nearest 10.

      *₹390/month (₹13 per day) is starting price for 1 cr. Health insurance for 25 years old male, with pre-existing diseases, residing from tier 1 city rounded off to the nearest 10.

      *No medical tests are required unless requested by the insurer’s underwriter. In-case of pre-existing diseases relevant medical proof would be required as per the terms and condition of the policy opted.

      *The values taken for effective cost calculation are indicative values and may change as per the selected plan.

      *Coverage upto double the amount of Sum Insured is available on certain covers for a minimum plan of Rs. 5 Lakh on the first claim only to an individual of upto 45 years of age with no pre-existing diseases. The benefit is available with or without extra cost depending on the plan chosen.

      *Coverage of pre-existing diseases is provided by insurer as per their underwriting policy.

      *The scope of coverage may vary from plan to plan.

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