One day afternoon one of my friends came
to my office and asked his doubts about the health insurance cover. Looking
very disturb, started putting his query, look I and my family are covered for Rs.
3 lakhs health insurance individually, but I think the same is not sufficed and
showed his concern. He added I am coming from hospital where one of my relative
is admitted since last 10 days. He met with a major accident at pune express
way and the total hospital bill till date is approx. 13 lakhs. He further
added, I am very much worried about what should be the cover one should have? I
am already paying premium of Rs. 25,000 p.a. and it is not possible for me to allocate
more than double amount immediately. He curiously asked is there any way? The
question was very much genuine and relevant to all of us as we have to cover for
each and every uncertain thing in our life. I started answering his questions, look
most of people are now opting for at least 3 lakhs sum assured policy realising
that cost of the medical is rising at higher percentage. This amount may be sufficient for minor surgery or illness.
However with rising healthcare expenses, the above sum insured may not be
sufficient for critical illness or major accident. At the same time, these
expenses can neither be avoided. The higher medical expense inflation need also
to be considered while opting for health cover. Today 3 lakhs cover looks good
but after 5 to 7 years it will be mostly inadequate.
Then I explained him the new version
of health insurance plan, i.e. Top Up plan. This plan is a recently becoming
more and more popular as it covers high sum assured. The premium payable is
also low and hence become affordable. Top Up plan is add on health insurance
plan which comes into picture only when the single claim is above certain deductible
limit. The plan comes with minimum deductible of Rs. 1lakh to Rs.5lakhs
depending on plan to plan. Deductible means the policy will be eligible for
claim only above deductible limit. Normally deductible does not reduce sum
assured. Deductible is the amount over
which the claim for each hospitalisation is reimbursable. For example: You have
a basic health insurance Rs. 3 lakhs
and also buy a top-up policy of Rs. 10 lakhs
with deductible of Rs. 3 lakh.
In the event of a serious hospitalisation with a claim of Rs. 13 lakhs; Rs. 3 lakh will be paid by your base plan and Rs. 10 lakhs will be paid by your top up
plan.
The plan is normally
beneficial for those who already have a basic health plan individual or group and
want to enhance their sum insured at an affordable premium amount. It is not
compulsory to have a base health insurance plan to buy a top-up plan, but it is
always advisable to take a base policy first before opting for top-up plan. The only difference
is between normal mediclaim plan and top up plan is the deductible amount. Policy
holder has to opt for deductible amount at the time of buying the fresh plan. The higher the deductible, the cheaper will be the
plan. But top-up health plans should be bought to bridge the gap between
existing policies and actual costs. Also, in top-up policies, most insurers do
not ask for medical check-ups up to the age of 55 years. In reimbursement
plans, this is usually 45 years.
It is advisable to buy
top-up plan from the same insurer from which you have bought individual or
group health insurance. This saves time and documentation work at the time of
claim. Normally it is better to coordinate with one insurer for reimbursement
of claim, than to coordinate with two different insurers. The premium for 30 year
old male for Rs. 3 lakh sum assured is around Rs. 3,000 p.a. in base plan. If
the same person buys the top up plan of Rs. 10 lakhs with deductible of Rs. 3
lakhs, the premium will be around Rs. 3,000 p.a. So by paying just double
premium you can increase your health insurance cover by four times. It is
advisable to buy base plan as individual cover for each member of family and
top up plan as family floater as the big claim mostly happens in the rare. So
the chances of big claim are unlikely to happen to all family members except
all are travelling together and met with major accident.
Both your indemnity
policy and the top-up plan can be claimed together for single hospitalisation.
The first condition to be met is the threshold of the top-up plan. Another criterion is
that a top-up plan normally works only on a single incidence of
hospitalisation. This means that you can use the top-up plan only if your
medical bills exceed the deducible amount during a single hospitalisation by a
single member. If relapse happens within 45 days
of discharge from hospital, it is usually considered single illness. However,
if the customer is hospitalised again for the same illness but after 45 days
from discharge, it is usually considered a fresh illness. So, the deductible
has to be crossed for every single illness for policy benefits to commence.
There are few plans which do not have the limit of single claim but can be
claimed for any illness over deductible amount for entire year. This plans are
known as super top ups.
Insurance planning is the first step for success of financial planning.
If you and your family members are adequately covered for health insurance than
most likely that your investment will work better for you. So top up plans are
the need of hour and avoiding it can cost you a lot and can also spoil your
financial freedom.
