Health Insurance Concepts You Should Know
Every year, medical costs in India are rising at an exponential rate and thus, having a health insurance policy is a must for everyone. A health insurance policy pays for medical costs of the insured in case of hospitalization and for any other illness which is covered in the policy. With a health insurance policy, you don’t have to shell out money from your savings and thus, the policy ensures a safe future with respect to health and savings. Having a health insurance policy is a must but what is equally important is to understand the policy and the concepts. Let us talk about some important concepts:
Deductibles and Co-Payment
A deductible is an amount which the policyholder pays from his own pocket at the time of a claim. Co-payment is also a similar concept. However, the difference between the two is that, the former is a fixed amount and the latter a percentage of the total hospital bill. Neither of these has an effect on the sum insured, but is a requirement for cost sharing with the insurance company.
At times, the insured might face some issues with the insurance company with respect to service or other matters like high premium. If due to this, he stops renewing his policy and buys a new one, he tends to lose on various benefits which he might have earned on his existing policy. This can be avoided if he ports the policy to another insurer. In this way, he can get a better insurance company and not lose out on the benefits like time bound exclusions and pre-existing conditions.
Many insurance policies have childbirth and maternity expenses as exclusions whereas some have a waiting period. There are other plans which cover the same but the premium is higher. However, these plans cover all medical expenses for a delivery incurred during hospitalization. These policies also cover pre and post-natal expenses.
Pre-existing diseases are the ones which have been diagnosed or of which the insured had symptoms or had received medical treatment and advice, 48 months prior to the first policy taken by the insured. Initially, most of the pre-existing diseases are not covered in a health insurance policy, but they eventually do get coverage. It is very essential to disclose any medication or ailment at the time of purchasing a policy so that there is no issue of claim rejection later.
Types of Health Insurance Plans
Knowing the basic concepts of health insurance is important, but what is equally important is to know is the types of health insurance plans available.
In these plans, there is a reimbursement of the expenses incurred by the insured during hospitalization, subject to the sum insured. The sum insured can be for an individual or can be shared by a family, depending on the plan. In these plans, either the claim is settled in a cashless way or the amount spent by the insured is reimbursed.
Hospital Daily Cash Benefit Plan
In this plan, a certain sum of money is paid to the insured for every day of hospitalization, irrespective of the cost incurred.
Critical Illness Plan
These are plans which cover a certain number of critical illnesses and give the insured a lump sum amount when any of the critical diseases listed are diagnosed. These plans might cover kidney problems/failure, heart attack, cancers of different kinds etc.
The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.