Medical emergencies can strike anyone and anytime. To add to this are the rising medical costs that have the ability to dive a hole in your pocket. One approach to overcome such hurdles is to be prepared by buying a health insurance plan. This insurance helps reduce economic worries by covering basic illness treatment costs, hospitalization expenses and other such expenses.
What is Health Insurance?
Health insurance offers monetary protection to meet the expenses incurred due to hospitalization or treatment of some disease. It is an understanding signed between the insurance organization and the policyholder. The organization or the insurer agrees to provide the whole insured or the coverage add up to the policyholder (the insured) for meeting the medical expenses. To get this benefit, the insured needs to pay a certain measure of money as premium. However, not a wide range of circumstances and cases are covered by health insurance. These are called exclusions. Let us understand health insurance in detail.
What is Health Insurance Premium?
To get the budgetary protection under a health insurance plan, you need to yearly pay certain measure of money as premium. This can be called the expense of the insurance. Premium is a significant aspect to be considered before settling an arrangement. Continuously use the premium mini-computer available on the insurance organization website or insurance web aggregators to know the premium sum. This helps to compare different plans and to gauge your moderateness of purchasing the arrangement. Some of the components taken into account while deciding the premium sum are:
- Type of insurance plan: The premium for a health insurance plan depends on the type of plan chosen. It is different for a family floater and an individual arrangement
- Nature of work of the candidate: The nature of your occupation goes on to decide the premium sum. In the event that your nature of work is riskier, you will pay a higher premium sum. For instance, a truck driver’s activity is riskier than that of a teacher. In this manner, the driver will pay higher premium compared to the teacher
- Age: For getting a health insurance plan, age is a significant factor. Along these lines, it additionally decides the premium sum. Higher the age, higher the premium sum, as older people have higher chance of suffering from any illness
- Current medical condition: Any medical history or rather the current medical circumstance of the person assumes a fundamental role in deciding the premium sum. In case of any pre-existing illness, the premium may go up
- Number of relatives covered: For an individual health insurance plan, you get the coverage for more than one relative. Along these lines, the premium sum depends on the number of relatives included in the arrangement
- Arrangement term: The span of the health insurance approach decides the premium sum. Along these lines, if the arrangement is for longer length, premium sum will consequently increase
Types of Health Insurance Plans
Health insurance is available in different structures. However, all the health insurance policies can be comprehensively categorized under two types: indemnity plan and fixed benefit plan. Let us understand these two types in detail.
A. Indemnity Plan
This arrangement covers hospitalization expenses up as far as possible decided during the purchase of the strategy. An insured can decide on multiple cases in a year, however the aggregate sum given ought not exceed the most extreme entirety insured breaking point or the sum you are entitled to get from the insurance organization. This arrangement type is otherwise called mediclaim approach. You additionally have the benefit of profiting cashless treatment at different network medical clinics, where the insurance organization pays on your behalf.
Types of Indemnity Plans
1) Individual Insurance Plans: This type of health insurance is meant for a person. Consequently, the insurance provider covers just the medical expenses incurred by a person. The treatment expenses covered in these plans normally include all the costs incurred through hospitalization, pre and post-confirmation, charges for different medical tests and research center charges, and discussion charges. Since this hazard cover is just for an individual, the premiums are cheaper than that of other plans. These individual mediclaim policies don’t cover any existing illnesses. However, after sitting tight for a certain period, these diseases may get covered by the insurance organization. Numerous insurance policies don’t cover ayurvedic, homeopathic or some other non-allopathic treatments.
2) Family Floater Insurance Plans: These types of insurance plans cover the entire family. Instead of purchasing different individual plans, you can get a family floater that would cover the medical and treatment expenses of all the relatives. These plans include the policyholder, his/her spouse and children. Minor children as long as 2 years can likewise be covered under this arrangement. Some plans additionally include kin and parents in law. Family floaters can provide health coverage for up to 15 relatives in one single arrangement. In this way, all the relatives share entirety insured provided by the insurer.
3) Senior Citizen Insurance: These insurance plans cover medical treatment or hospitalization expenses of people aged 60 years or more. Illness and other health-related problems after the age of 60 years are normal. Retirement may likewise deprive people of any regular income. In such a circumstance, bearing all the medical expenses may be a major burden. Along these lines, senior citizen health insurance plans can help in meeting medical expenses during emergencies. It is required by the IRDA that the policyholder must be at any rate 60 to 65 years while applying for the approach. Some of the insurance companies additionally make people undergo medical examination before authorizing a strategy. The hanging tight period for these policies can range from 1-4 years in case of certain illnesses.
4) Maternity Insurance: Maternity Insurance plans are specifically meant for women wanting to have a youngster or are bearing one. It covers all the expenses before and after the pregnancy, the expense towards the kid, mother’s care expenses, and any inconveniences that may arise due to pregnancy. Such an arrangement can be added to the principle Individual or Family Floater approach. Moreover, it can likewise be attached with the Group Insurance plans provided by the employers which have a sub-cutoff of up to Rs. 50,000. All the expenses related to tests, medicines, work, and affirmation can be reduced by taking this arrangement.
Any emergency transportation due to pregnancy-related distresses, expenses for delivery, nursing and counsel are additionally covered in this arrangement. It likewise includes the congenital or a basic disease diagnosed in the newborn. The holding up period is up to a limit of 4 years, as simply after that all the benefits can be availed. Hence it is advisable to purchase this arrangement well before conceiving. The exclusions include charges for regular checkups, analytic exams, and counseling fees, any medicines like nutrients, during the pregnancy.
5) Group Medical/Employee Insurance: Group Medical Insurance is provided by employers to their employees. The gatherings under such a strategy include members of any affiliations, companies, etc. Moreover, by paying some extra sum, employees can likewise extend the arrangement to include other relatives like spouses, children, parents, etc. Like other plans, the premiums paid under this arrangement are charge exempt. Some policies additionally cover existing diseases and maternity expenditures. Unlike other plans, to purchase the arrangement, employees don’t need to produce any documents or undergo any medical examinations. Additionally, the premiums are cheaper here. The arrangement can be contributory, where employees likewise pay a piece of the premium, or non-contributory, where just the employer pays the premium.
B. Fixed Benefit Plan
This arrangement does not offer hospitalization benefit. It pays a fixed sum for certain listed basic diseases and conditions, for example, cancer, heart illnesses, etc. Under this arrangement, one likewise gets coverage on the determination of certain diseases.
Types of Fixed Benefit Plans
1) Preventive Insurance: A preventive health insurance plan covers expenses for regular health checkups required to prevent any dangerous illness like cancer. For this, a yearly medical examinations can be needed to analyze the possible side effects. Such plans can provide coverage for any checkups done in a network clinic of the insurer. Expenses likewise cover all the preventive measures taken for the policyholder, spouses, children and parents. Children up to the age of 13 years are covered under this approach. Unlike other plans, this arrangement includes tests related to HIV/AIDS, cancer and cholesterol.
2) Critical Illness: Critical illnesses are ailments not included in health insurance plans. These are some specific conditions which can lead to permanent inability or death. Some of the diseases covered by the arrangement include cancer, organ transplant, and failure, multiple sclerosis, loss of motion, blindness, strokes and heart assaults, kidney failure, extreme lethargies, basic heart surgeries, among others. The approach provides a singular amount sum for the treatment of these diseases. This strategy can be purchased either separately or as an extra with a life insurance plan. Under such an arrangement, if the policyholder is diagnosed with any of the basic illnesses included in the list within the tenure, he/she gets the case benefit alongside other benefits. Some companies additionally provide a day by day allowance benefit because the policyholder is unable to work and earn income due the illness. Such plans normally have a lower holding up period.
3) Hospital Daily Cash Benefit: It offers fixed benefits, for the most part after 24-48 hours of hospitalization. The coverage is over or more the benefits provided by a health insurance plan. This arrangement covers expenses as a rule not included in a health plan. You get a fixed sum every day during hospitalization.
4) Personal Accident: The arrangement offers coverage against accidental death and permanent aggregate and fractional inability of the policyholder. Such an arrangement would be a great extra with the engine insurance to cover the death or real injury to the driver. In case of an untimely demise of the policyholder, the arrangement likewise offers entirety assured to the relatives to take care of different expenses and needs. No health documents are required to purchase this strategy. It very well may be availed for the two people and gathering. Likewise, numerous policies cover all the legal and funeral expenditures separated from covering any damage caused due to terrorist assaults.
A Personal Accident cover can be classified into 2 types:
Singular Accident Cover: The arrangement covers a person’s disabilities, dismembering of body parts or death due to an accident.
Gathering Accident Cover: It is provided by employers to cover the expenses of the employee’s families on his/her sudden demise.
What Health Insurance Covers?
Health insurance companies offer a plethora of plans and policies to choose from as per your need and requirement. You ought to understand the coverage well before settling on a specific arrangement and strategy. Let us take a gander at some of the regular focuses covered by different plans offered by health insurance companies.
- Pre-and post-hospitalization expenses: This insurance pays for medical expenses incurred between 30 and 60 days before hospitalization. These cover things like expense of medication and medical tests, etc. This is separated from the typical coverage like meeting the expenses for hospitalization of in any event 24 hours, room rent, cost of surgery, etc. It likewise covers the medical expenses between 60 and 180 days after hospitalization like that for medication, home treatment, etc.
- Ambulance charge: Almost all health insurance plans cover the expenses related to ambulance service.
- Day care charges: Some of the health insurance plans likewise cover the expenses for treatments taken up without hospitalization of as long as 24 hours. These include cases like dialysis, radiotherapy, chemotherapy, etc.
- Health check-ups: Some of the health insurance companies likewise cover the expense for preventive health check-ups.
Documents Required to Process Claims
So as to get the cases settled on time, certain specific documents are required.
- Appropriately filled in guarantee structure
- Medical certificate from specialist
- Discharge list
- Investigation report
- Drug store bills
- FIR (in case of accidents)
Note: This isn’t an exhaustive list.
A health insurance strategy helps manage any unforeseen medical expenses. In this way, in case of any eventuality, you need to properly file asserts so as to get the benefit. There are two types of cases: cashless and reimbursement claims.
Cashless cases: To benefit this sort of guarantee, you need to use one of the network clinics, which is an emergency clinic empanelled with the insurance organization. Here, the policyholder does not have to pay the hospitalization expenses as it is borne by the insurance organization.
Let us understand the cashless case process.
- In case of planned treatment, advise the insurance organization in advance. This should be possible through email or the cost free number
- On hospitalization, provide the health card given by the insurance organization to the Third Party Administrator (TPA) desk of the medical clinic alongside an endorsement from the treating specialist
- Additionally present the required documents
- Once the insurance organization approves the case, it pays the medical expenses directly to the clinic
- Reimbursement claims: Here, the policyholder makes the payment for the treatment and hospitalization. However, he/she gets back the money later as per the total insured sum after presenting the required documents.
Let us understand the reimbursement guarantee process.
After paying the medical expenses all alone, present the bills and other required documents to the insurance organization
After an evaluation, if the insurance organization finds the case fit, it will make the payment to the insurer
Time Taken to Settle Claims
After receiving a case request, a health insurance organization as a rule takes 30 days from the day of receipt of documents to settle the case. However, on the off chance that there is any sort of investigation needed to process the case, it as a rule takes 45 days to settle the case from the time of receipt of documents.
Health insurance provides coverage for different sorts of medical expenses, treatments and illnesses to help you to manage your finances better. However, certain circumstances and cases are not covered by health insurance plans, however the list varies for different providers. Continuously understand these exclusions well before settling an arrangement so you don’t face problems later. Let us take a gander at some normal exclusions.
- Dental treatment, including surgery
- Treatment for AIDS and other sexually transmitted diseases
- Non-allopathic treatment
- Certain pre-existing diseases and basic illnesses
- Maternity or newborn coverage (You need a rider to get this coverage)
Note: This isn’t an exhaustive list.
Before finishing a specific health insurance organization and an arrangement, it is imperative to keep certain focuses at the top of the priority list with the goal that we understand the strategy well. Let us take a gander at some aspects.
- Guarantee Settlement Ratio (CSR): This is the percentage of cases settled compared to the percentage of cases received. Continuously go for an organization with a high case settlement record. Along these lines you will be sure of the way that your cases will be settled easily on time.
- Cutoff points: Understand the cutoff points and tops on certain areas like that on room rent with the goal that you know how much expenses you have to bear.
- Coverage: Be clear of the coverage being offered in the arrangement with the goal that you know whether your needs and requirements are being fulfilled or not. For instance, some plans don’t cover non-allopathic treatment.
- Holding up period: For certain pre-existing diseases, some insurance companies have a holding up period of few years before they get covered by the arrangement. Realize these diseases before buying the arrangement.
- Network emergency clinics: Opt for the insurance organization that has a decent number of network medical clinics so you can get cashless case facility whenever needed and you don’t have to pay from your own pocket.
Advantages of Buying Health Insurance Policy
Health insurance shapes a significant piece of one’s money related portfolio. Let us take a gander at some of the benefits of the insurance:
- A health insurance plan helps manage the unexpected treatment or hospitalization costs that have the potential of derailing your budget and creating money related burden
- The arrangement helps in dealing with the rising medical expenses
- It offers peace of brain when the budgetary burden is taken care of by the insurance organization during such pressing times
- Treatment at network clinics provide cashless facility
- It helps in sparing duty
- Premiums paid for health insurance are charge exempt up to the furthest reaches of Rs 1 lakh under Section 80D of the Income Tax Act, 1961
- For people below 60 years of age, the premium sum on which you can save charge is Rs. 25,000. This remains constant even on the off chance that you pay the premium for spouse and dependent children
- For people above 60 years of age, the breaking point is Rs. 50,000
- Assessment exemption limit is up to Rs. 50,000 for parents over 60 years old
- In case the age of the taxpayer and that of parents is 60 years or above, as far as possible is Rs. 1 lakh
Terms Related to Health Insurance
Let us see some terms you ought to understand to know health insurance better.
- Deductible: It is the sum paid by the insurer for certain items after which the health insurance coverage begins.
- Co-payment: When the case sum is shared between the policyholder and the health insurance organization, a certain piece of the case sum is paid by the policyholder.
- Whole insured: This is the greatest sum that the health insurance organization is liable to pay to the policyholder in case of any eventuality.
- Pre-existing diseases: These are the diseases that a policyholder suffers from before getting the health insurance coverage.
- Holding up period: On purchasing a health insurance strategy, coverage for certain diseases begins after few years. This length is called holding up period.
- Cumulative reward: It is the reward, additionally called no case reward, that you get to enjoy when you don’t make any cases in the previous strategy year.
Grouping of Health Insurance Plans in India
Reimbursement or Indemnity-based Health Insurance
It is normally known as mediclaim plans that have a yearly breaking point and is renewed every year. In this case, the insurer will reimburse any medical expenses incurred due to hospitalization, conclusion, and pre-and post-hospitalization treatments. This type of plan is available as:
- Singular Health Insurance Plan: In this arrangement, just a single person is covered for the chosen aggregate insured. To enroll relatives under this plan, a different entirety insured must be chosen for each member.
- Family Floater Insurance Plan: This type of plan is designed for families, wherein, a fixed aggregate insured is available for every insured member for one or more cases during the arrangement tenure. The insured members could include spouse, dependent children and parents.
- Fixed Benefit Hospitalization Plan: In this arrangement, one gets fixed coverage and benefit payouts if the insured member is diagnosed with a specified illness or hospitalized. It offers fractional coverage to hospitalization costs and provides a substitute income.
Some of the extra health insurance additional items or riders that can be attached to your base strategy are:
- Basic Illness Plan: This is the arrangement wherein the insurer will pay a fixed benefit payout if the insured person is diagnosed with any of the basic illnesses specified under the approach and furthermore the single amount benefit can cover hospitalization cost and go about as an income supplement.
- Careful Benefit and Hospital Cash Plan: This plan covers defined hospitalization and surgery costs. To profit the benefits of this arrangement, you need to submit medical bills to the insure
Health insurance plans in India can be purchased as per a person’s requirement. It depends on the insured whether they need a health insurance plan that covers patient expenses, basic illnesses, maternity expenses, accident-related expenses, or is a mix of all. Health insurance policies are nothing however a kind of blessings in disguise as they are mostly used as budgetary reinforcements during medical emergencies. They cover the expenses incurred on hospitalization or the medical bills.
- Singular Health Insurance Plan
Singular health plans are designed to protect a person from emergency medical expenses. It serves as an agreement between an insurance organization and a person under which the insurer promises to cover the medical expense incurred by the insured person in return for a premium sum paid by the customer. These individual health insurance plan additionally covers hospitalization expenses, pre and post-hospitalization expenses, medical examinations charges, research facility charges, maternity care expenses, and meeting fees.
Singular health insurance plan does not cover the accompanying things:
- Pre-existing diseases
- Non-allopathic treatments
- Substance abuse treatments required due to excessive utilization of liquor and medications
- Cosmetic surgeries
- Family Floater Health Insurance Policy
A family floater insurance approach is a health plan that offers insurance coverage to the entire family. These plans are ideal for large families as they can cover the medical expenses of the entire family. It will help you save a great deal of money and time by covering the policyholder, spouse and dependent children.
However, there are few insurers in the market who permit policyholders to include their dependent kin, parents and parents-in-law too. Even in the event that you have great knowledge of family floater plans, it is necessary to do great research before purchasing any medical insurance plan. Family floater insurance plans cover up to 15 relatives in the majority of the plans.
- Senior Citizen Health Insurance Plan
These plans are designed for people who are more than 60 years of age. It tends to be a shelter for you post-retirement where you probably won’t have regular income and might encounter medical emergencies.
- Basic illness Plan
These plans are significant as they cover a number of deadly illnesses that are increasing step by step. Basic illness refers to a serious health condition that affects the lifestyle of a person and is often lethal. Aside from the real torment and emotional injury that a person goes through, it additionally gives rise to serious money related emergency. Health insurance providers in India offer comprehensive basic illness plans at affordable prices in India to help people with the basic illness.
An indemnity health insurance approach may not be sufficient to cover a basic illness treatment which can lead to inability and loss of income. You can join a basic illness rider to your base arrangement to give you an enhanced money related protection. Choose the basic illness rider with:
- Low holding up period
- High number of illnesses covered
- The most extreme age to renew Critical illness plan is 60 to 65 years
- High number of illnesses covered
- The measure of aggregate insured in case of basic illness is 4 to 5 times the yearly income
- Affordable premium
The strategy tenure can be anywhere between 10 and 15 years with yearly renewability choice in case of basic illness plans.
- Maternity Health Insurance Plan
This insurance plan helps you to be monetarily prepared to welcome an infant home. During maternity, numerous interviews, subsequent meet-ups, and medical tests are required and to cope with this maternity expenses it is critical to purchase maternity health insurance. You can connect a maternity insurance rider to your base health insurance strategy to provide insurance cover for pregnancy and labor expenses. This insurance benefits can help reduce cost of hospitalization, delivery, tests and medication.
- Gathering/Employee Health Insurance Scheme
This arrangement provides insurance cover to a gathering of people like employees, members of affiliations, etc. Employers provide their employees with bunch health insurance as an incentive to support morale and retain personnel. The employees can decide on extra coverage for their relatives with extra premium payment. This arrangement permits employers and employees to get charge deductions on premiums paid towards bunch health insurance as per the Income Tax Act, 1961. The health insurance for employee covers self, spouse, children and parents. There are insurance companies that provide cover prevailing conditions and maternity expenses.
- Preventive Healthcare Plans
This arrangement includes testing, detection, and minimization of disease-causing factors in a person at an early stage. Consider an example wherein finding of cancer in later stages or a heart condition is ineffectual. One ought to go for a regular health check-up regularly.
- Personal Accident Insurance
Accidents, whether minor or basic, can’t be predicted. Such incidents take your time, money, and attention irrespective of the intensity of the accident. This health insurance helps you cover the expenses in case of an accident. It not just covers your medical expenses caused due to an accident, yet additionally gives your family or loved ones a total assured sum in case of the sudden demise of the insured person. This serves as a money related security for your family in case of unforeseen circumstances. You can join a personal accident cover to your base insurance approach.