Decoding Insurance

Feeling Inadequately Insured? 3 Ways To Extend Your Health Insurance Cover

How to increase Health insurance cover

Even the best healthcare systems around the world have been overwhelmed by the Covid-19 pandemic. In India, news reports pouring in about inadequate hospital capacity, public and private combined, are beginning to reach alarming proportions. The prevailing exorbitant cost of treatment at private hospitals is sure to decimate the personal finances of even those with reasonably good planning. This is the time to re-evaluate if your health cover offers adequate protection against utterly unforeseen emergencies such as the Covid-19 pandemic. The desire to opt for a lower health insurance cover to save on a few thousand rupees in premium might truly make you appear penny wise and pound foolish in these times.

Moreover, in India, the cost of healthcare is rising fast, pandemic or not.

If you have a health cover and feel that the sum insured is not enough to cover possible medical emergencies, you have three options to remedy the situation:

1. INCREASE YOUR SUM INSURED AT THE TIME OF RENEWAL
Every insurer gives you the choice to increase your sum insured at the time of renewal. The good part about this is that there is no waiting period unlike opting for a new health insurance plan which will have a waiting period of up to four years for pre-existing diseases. An individual with a spouse and a kid should go for a health insurance cover of at least Rs 20 lakh. A cover of that size for a young family of three with a 5-year-old child will cost about Rs 25,900 a year. 

2. BUY A SUPER TOP-UP PLAN
A top-up plan provides additional cushion to your existing health cover when your hospitalization bill crosses your sum assured limit. For buying a top-up plan, you need to choose a deductible. Deductible is the amount that the insured pays from their own pocket, or their basic health policy pays for it before the top-up cover activates. Top-up policies only pay for the amount above the deductible limit.

Suppose your top-up cover has a deductible of Rs 5 lakh and in a year you submit as claim two separate hospital bills of Rs 4 lakh and Rs 1 lakh, then your top-up plan won’t be activated. In such a case, super top-up comes into play. A super-top up has provisions for multiple claims.

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It is best to buy a super top-up plan from your existing insurer as it is easier for hospitals to coordinate with one insurer for a customer at any given time. There are many health insurance plans available in the market which have a base plan and a top-up health cover. Super top-up plans also provide coverage for both pre and post-hospitalization expenses, along with pre-existing diseases (with a waiting period) and daycare procedures.

The premium paid for super top-up plans is also eligible for income tax deduction under section 80D. Top-up or super top-up plans are also cheaper as compared to a comprehensive individual health insurance policy. The higher the deductible, the lower will be the premium of your top-up or super top-up plan and vice-versa.

3. PORTABILITY 
Portability is when you switch your health insurance policy from one insurance provider to another. While applying for portability, you can seek an increase in sum assured. However, this request for an increase in sum assured is subject to acceptance by the insurer. The extent of the increase in sum assured is decided by the underwriter depending upon the age and health of the customer. Your claim record has the biggest impact on the insurer’s decision to give you an expanded cover. If the request is made for a claim-free policy, the chances of approval are high. An individual should also carefully check the benefits being offered by the new health insurance plan while porting a policy.

When you want to port your health insurance policy, you need to approach the new health insurer at least 45 days before the expiry of your existing policy. You need to fill a proposal form for portability and provide copies of the existing policy. On receipt of the request, the new insurer will approach the existing insurer to know your medical and claims history. Once the new health insurer obtains all the details, it has to take a decision on whether to accept porting within 15 days. If the insurer fails to do so, it will have to perforce accept the application.

(Article edited by: Sunny Lamba)

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