Health Insurance is an insurance policy that ensures that you get cashless treatment or expense reimbursement, in case you fall ill. A health insurance policy reimburses the insured for medical and surgical expenses arising from an illness or injury that leads to hospitalization.
The insurance company provides the insured with the facility of cashless hospitalization at a network hospital or provides reimbursement for the incurred expenses. Furthermore, health insurance cost is subsidized to the insured in the form of tax exemption under section 80D of Income Tax Act, 1961.
Importance Of Health Insurance Today
Health insurance in India is one of the fastest-growing industries. However, this wide scope for growth indicates the limited penetration of health insurance among the Indian populace. As per the latest report released by the National Sample Survey Organization (NSSO) titled “Key Indicators of Social Consumption in India: Health”, only 20 percent of the Indian population had health insurance coverage. Additionally, only 18 percent of the total population residing in urban areas and 14 percent of the total population residing in rural areas had any form of health insurance coverage.
Thus, there is no debating the importance of having insurance in a country like India where medical expenses are sky-rocketing. Everyone must buy a good health insurance policy that includes medical costs, hospitalization costs, medication and laboratory test costs, including critical illness. Don’t get confused with questions like – Which health policy to buy? Does it cover every eventuality? What illnesses are excluded from this cover?
Best Health Insurance Policies in India By Top Health Insurance Companies
|Insurance Company||Coverage||Incurred Claim Ratio||Waiting Period||Renewability||Network Hospitals|
|Max Bupa Health Insurance||4 members of the family (2 adults + 2 children)||51.96%||4 years||Lifelong||Over 3500|
|HDFC ERGO Health Insurance||4 members of the family (2 adults + 2 children)||76.90%||4 years||Guaranteed Lifelong Renewal||Over 5000|
|Bharti AXA Health Insurance||4 members of the family (2 adults + 2 children)||76.88%||4 years||Lifelong||Over 5000|
|SBI Health Insurance||4 members of the family (2 adults + 2 children)||75.01%||1 to 4 years||Lifelong||Over 3000|
|Bajaj Allianz Health Insurance||6 members of the family (2 adults + 4 children)||78.50%||4 years||Lifelong||Over 3700|
|Reliance Health Insurance||6 members of the family (2 adults + 4 children)||92.23%||4 years||Lifelong||Over 4000|
|National Health Insurance||6 members of the family (2 adults + 4 children)||97.25%||4 years||Lifelong||Over 6000|
Note: Figures shown in the table above belong to the Financial Year 2017-18.
Types of Health Insurance Policies in India
Everyone needs to secure their own and their family’s health. With the increasing cost of healthcare in India, buying a health insurance policy has become almost mandatory for everyone. In today’s world of options, people have different choices when it comes to purchasing health insurance. There are various plans readily available in India to include every aspect of a medical emergency. Some popular types of policies are explained below:
- Individual Health Insurance Policy: This type of health insurance provides coverage to an individual against certain illnesses, offering advantages like cashless hospitalization, reimbursement, coverage of pre-hospitalization and post-discharge expenses and various add-ons. The entire sum assured is available for only one individual.
- Family Health Plan: With a family health plan, you can include your family members under the umbrella of a single health cover. Family floater mediclaim policies offer a fixed sum assured to the family members, which can be availed either by one or all members of a family for one or more claims during the tenure of the policy. Family health plans come are more expensive than an individual health plan
- Senior Citizen Health Insurance: Senior Citizen health insurance is designed particularly for anyone aged above 60 years and offers protection from health issues during old age. According to IRDAI, every health insurance firm must include people up to the age of 65 years in its plans.
- Critical Illness Insurance Plans: This plan is usually brought as a standalone policy or as a rider for the treatment of various critical illnesses, such as kidney failure, paralysis, cancer, heart attack, etc. As the medication of such illnesses is expensive, the reimbursement related to them is also very high. A critical illness is a serious, possibly terminal, disease and is pre-defined by the provider. Most critical illness policies provide a lump-sum benefit if the insured is diagnosed with one or more of the specified terminal conditions.
- Maternity Health Insurance: Medical insurance companies today cover additional costs, including those incurred in both pre and post-natal care, child delivery (normal or cesarean), and sometimes include vaccination of newborn babies in a maternity plan. This insurance covers the newborn baby up to the validity of this policy. It also covers the transportation fee for ferrying the mom-to-be to the nearest network hospital of her choice.
- Personal Accident Cover: These personal accident plans are frequently offered as riders. They include hospitalization and bear the medical outlay in the event of an accident. These are issued as fixed benefit policies, where a specified sum is paid on the occurrence of unforeseen events, such as accidents, which can result in death or disability of the person. However, the payout is not related to the sum assured.
- Pre-Existing Disease Cover: After 2-4 years of policy inception, various policies begin considering pre-existing diseases, e.g. diabetes, hypertension, kidney failure, cancer, etc., for claims. Pre-existing disease cover is offered for the policy-specified illness(es) that the insured had before purchasing the policy.
- Preventive Healthcare: Undoubtedly, healthcare is very expensive and nobody wants to fall ill. So, now we have preventive health care that takes care of you before you fall sick. Preventive care, such as regular health check-ups, concession in X-ray fees, consultation fees, etc., is offered by this policy. By offering various healthcare provisions, this plan aims at keeping you healthy. Preventive care is medical care rendered not for a specific complaint but prevention and early detection of ailments.
- Unit Linked Health Plan: Unit- Linked Health Plan (ULHP) has been introduced recently, which offers a unique combination of health insurance and investment. Apart from giving health protection, ULHPs also contribute to building a corpus that can be used to meet expenditures that are not covered by health insurance policies. Among the ULHPs available in the Indian market, ICICI Pru’s Health Saver, LIC’s Health Protection Plus, Birla Sunlife’s Saral Health, and IndiaFirst’s Money Back Health Insurance Plan are a few big names. By opting for this plan, one can save a certain amount which can later be used to pay for the treatment of any pre-existing illnesses that are not covered by a normal health policy during the waiting period.
Benefits of Having A Health Insurance
Along with the importance, there are also many benefits that an individual has no idea that the policy he opted for also provides these. These benefits are the hidden ones and a policyholder, most of the time, is not aware of these benefits and therefore not able to extract the true potential of the policy.
Renewal Can Be Done Lifelong
Almost all the health insurance plans come with an age limit of 70-80 years. However, the renewal time provided by the companies is extended to 10-20 years more. But the limit set by a majority of them is 90 years.
If a policy comes with a lifelong renewal feature, one must go for that one only. If an individual is not able to get the cover in his/her old age when the medical needs are needed most, that’s a huge drawback of investing so much for so long.
This feature of a health insurance policy is much underrated. It provides the holder an approximate amount when he/she gets discharged from the hospital. This amount is provided to the individuals to sustain until he/she joins work after the illness.
The only condition that this feature comes with is that the owner is hospitalized him/herself and the hospitalization period must not be less than 10 days. This feature is also called as convalescence benefit by some companies. A majority of people remain unaware of this and don’t make the claim.
Health insurance plans will provide timely care to the ill person. When there is no health insurance plan, this happens many times that the treatment gets delayed due to the absence of funds that are needed. In many cases, it is seen that the delayed treatment worsens the condition of the patient. Health insurance will take care of all the expenses.
There are not many policies that are operational in India having this feature, but it’s happening.
Refill of The Cover Amount
The insurance companies generally leave the policyholder on their own if the total assured amount got used. This also kills the purpose of having an insurance policy. The part where this feature comes into play is when a person is hospitalized and the amount got exhausted, the insurance company refills the amount and doesn’t leave the policyholder hanging in time when that person needs the company most. This is one of the most important benefits of health insurance.
This feature comes with an extra premium amount but it’s value for money and if the company has this feature in the policy, one must opt for it as it provides extra coverage than the actual insured amount.
The insurance companies are now providing many cashless options and it awards the insured person with the option to stay away from the stress of cash. The insurance company will take all the responsibility and the policyholder will not have to deal with any payments.
Maintaining sufficient cash is a very difficult thing to do. At these times, the insurance companies come as the biggest helping hand. They deal with the hospitals and try to indulge in as little cash as possible. As the insurance company will deal all by itself with the hospital listed in its network, the cost will also be much lesser.
The best health insurance plans come with this feature. It may occur that an individual got promoted or the business is finally on track or any opportunity came where the income of the policyholder increased, in that case, the holder has the option to get bigger coverage as he/she can now afford it.
It would be very tiring to get all the procedures done again to get a new bigger policy. The feature comes in very handy as it allows the individual to top-up the existing plan and it increases the cover amount by much. The premium is now set accordingly.
The health insurance will also cover the daily room rent. The hospital rooms are very much costly and have the potential to take a whole lot of savings. Insurance companies providing the cover for the same turns out to be of very much help. The only part that a person should worry about is reaching the hospital as soon as possible.
However, there is a cap on room rent coverage and the policyholder must take note of that before finalizing a purchase. Room rents can be very exhausting and a huge burden if the policies were not there to provide the cover.
The insurance policies don’t cover the treatments taken from ayurvedic, homeopathic, or naturopathic routes. The companies put these treatments in their exclusion clause. However, the trend is changing rapidly. National Insurance is the first insurance company that came up with one such benefit of health insurance.
The regulatory authority, IRDA, is expected to take some reformative decisions in this step where the insurance companies will have to set a percentage in the cover amount towards the treatments that an individual is taking from these alternative methods.
Many cases require the patient to stay at home, as he/she is not capable of moving to a hospital. As all the insurance policies only cover the expenses that are incurred in a listed hospital, they refuse to cover any amount if the patient is getting the treatment from home. There is a time limit for the in-home hospitalization. The cover amount will only be reimbursed if the hospitalization is of less than 72 hours.
This trend is also changing rapidly. If the doctor’s approval to get the treatment from home is attached, some insurance companies cover the whole amount. This feature is known as domiciliary hospitalization. Before finalizing the purchase, one must check the brochure again if the company is providing this service or not.
Exclusions In Health Insurance Policy
There is a whole range of points that almost all health insurance plans cover. From any critical illness to a pre-existing disease and covering the policyholder’s family in case of his/her death, all are covered under almost all the plans that these insurance companies offer.
But, there are also certain areas that these policies do not cover and if the individual that is going to get a policy for him/her is not aware of those points, the person is going to feel like getting trapped as soon as the time of claim arrives.
Some of the most common exclusions that most of the insurance companies do not cover are pre-existing diseases and alternative treatments (mentioned these as covered upside). However, these things are started to getting covered by some companies now and more companies are adopting it.
Still, there is much exclusion that is listed by the insurance companies and is not covered by any company whatsoever.
The diseases and illnesses that are caused by the lifestyle choices of the individual are not covered by any insurance company. The diseases related to the lungs caused due to smoking or any other disease caused by alcohol consumption or any other drug are not covered.
As the trend of getting cosmetic operations is becoming more and more common, the policyholders should not assume that these expenses are also covered under any insurance policy.
However, some companies provide the clause of covering those expenses if it is medically recommended and the necessity of the treatment process after an accident.
If an individual thinks that the benefits of health insurance also include pregnancy expenses or even the hospitalization expenses at the time of childbirth, it’s not the area that insurance companies cover. The cover for these expenses is provided by some of the insurance companies after a fixed waiting period is over.
The same case also applies to the treatments of infertility or the expenses in case of an abortion. These are some points that everyone must keep in mind while purchasing any insurance policy.
Expenses Before Diagnosis
Many tests need to be done to reach the final diagnostic. These tests, however, are not cheap at all. But the insurance companies don’t provide the cover for that.
If the tests confirm that a person is a carrier of a certain disease, the company will cover the costs from now on. This is the feature an individual must note about all the health insurance plans.
The insurance company will not provide the cover in the case of someone harming him/herself or has attempted suicide. Any deliberate self-harm is not covered under any policy of any insurance company.
The insurance policy doesn’t work as if a person purchased a policy today, he/she will start getting the cover from the next day. There is a clause in every policy that states all the waiting periods that the insurance company has preset to start providing cover amounts to the policyholder.
The standard waiting periods are:
- For existing diseases, it’s 2-4 years.
- For conditions like hernia and related to ENT, it’s 1-2 years.
- In case of treatment for newborn babies/infants, it’s 90 days.
- For any spinal disorder, tumor, joint replacement, cataract, etc., the waiting duration is 2 years.
Some exclusions are permanent and carry no chance of ever getting a place in the coverage. The medical conditions that are caused due to war, self-harm, along with HIV and congenital diseases are some of the permanent exclusions.
An individual needs to go through all the clauses along with terms & conditions before making the final purchase. In case of any confusion, ask the insurance company directly and never make any assumptions.
Top 5 Health Insurance Plans That You Can Consider
When it comes to getting a policy that covers the person along with his/her family, most of the people get very much confused and find themselves in the confusion. That causes the delay in getting a policy which eventually increases the premium amount.
Top 5 Health Insurance plans that a person can consider in 2019 are:
|Plan||Sum Insured||Age Limit|
|Religare Care Health Insurance Plan||Up to Rs. 50,00,000||65 years|
|Aditya Birla Active Assure Diamond Plan||Up to Rs. 50,00,000|
Up to Rs. 2 crores for a comprehensive plan
|Star Family Health Optima||Up to Rs. 15,00,000||65 years|
|Max Bupa Health Companion||Up to Rs. 1 crore for a comprehensive plan||65 years|
|HDFC ERGO Health Suraksha||Up to Rs. 7.5 lakhs (best for low-income people)||Up to 65 years for medical check-ups.|
Religare Care Health Insurance Pan
The prime features of this plan are:
- The policy comes with 65 years of age limit to enter the policy. It also applies to a person having the age of 100 years.
- To the holders above 18 years of age, Religare Care offers a complimentary health check-up, it doesn’t matter if the individual made any claim or not.
- There is also the provision of no claim bonus.
Aditya Birla Active Assure Diamond Health Insurance Plan
The prime features of this plan are:
- The premium amount of this policy makes it very affordable and economic.
- The top-up provision is also provided that allows the policyholder to keep getting benefits even if the limit is exhausted.
- A limit is also offered on this plan to cover the expenses if the policyholder is getting any alternative treatment such as Ayurved, Unani, Homeopathy, etc.
- The plan offers the cover amount for expenses incurred from 60 days before the date of hospitalization and 180 days post the discharge date.
Star Family Health Optima
The prime features of this plan are:
- The policy provides coverage for the whole family that too on a very affordable premium.
- A sum of Rs. 5,000 is offered for health check-ups every year without any additional cost.
- Star Family Health Optima also covers the newborn babies from the 16th day of their birth date.
- This policy has a list and network of over 6000 hospitals and also offers domiciliary hospitalization.
Max Bupa Health Companion
The prime features of this plan are:
- The plan comes in 3 variants, individual, family floater, and family first.
- Max Bupa Health Companion covers all the daycare expenses and provides a huge cover of over Rs. 1 crore.
- The policy also covers all organ transplants and in-home treatments.
- A discount of 12.5% is provided under this policy if an individual opts for a policy tenure of 2 years.
HDFC ERGO Health Suraksha
The prime features of this plan are:
- Anyone from any age can get enrolled under this scheme. There is an entry age limit of 65 years.
- Children under 5 years are covered under the policy with a condition, both parents should be insured under this policy.
- The pre-existing diseases are also covered under the scheme, however, the waiting period is 4 years.
- A 5% discount is offered as a no claim bonus every year if the policyholder doesn’t make any claim.
Why Health Insurance In Needed?
Most people haven’t yet understood the need for and importance of getting health insurance. Though, it’s not any new thing that’s introduced in our country. There are a lot of people who are still not convinced that health insurance policy does any good for them. It is very important to understand the need for health insurance and the benefit that the policy provides to the policyholder as well as the family.
The unexpected expense is just one of the many reasons for which the policy is needed. An individual can also remain stress-free that he/she has got a security that there will be no problem of funds to get treatment when there is a need.
Many families are unable to meet the medical expenses because the cost is going upward by every passing hour. Getting treatment when it’s needed is becoming a luxury and not everyone can afford it. Any disease related to cardinal or cancer will easily eat up around Rs. 5 lakhs to Rs. 50 lakhs in very easily. In case, a person hasn’t opted for any health insurance plans may not be able to bear such expense.
Some of the reasons to buy a suitable policy are:
The higher medical costs are the first and foremost reason for anyone to buy a plan for him/herself as soon as possible. Health insurance plans are very important for elderly parents as they have extra medical expenses.
In case someone is getting hospitalized, many expenses started to add up in the final billing. The expenses like doctor’s fees, bed charges, prescription costs, tests, check-ups, etc. are just a few of the many. As many people are moving to private hospitals in the hope of getting better treatment, these policies cover the expenses for those hospitals as well.
Another reason is getting quality treatment for everyone in the family. A health insurance policy can be a very effective tool to help in achieving that. Instead of getting all worried about the cost, an individual can focus more on the treatment quality and opt for a good hospital along with no stress on how the expenses will be met.
It is a need that most people don’t understand. In case a person is ill and hospitalized, he/she needs to stay relaxed as much as possible. Getting all worried about the expense will slow the recovery process and sometimes even decrease the health more than recovery.
There is a significant improvement in the lifestyle of a person when he/she remains stress-free from a certain area that carries the utmost importance in human life. A health insurance policy takes away the full responsibility just by taking some little amount from a person as a premium. Stress can take away a lot from a person and that situation starts causing the fall in the set lifestyle.
The least important of all the reasons, but a salaried, as well as business person, can get some help in the tax rebate. Section 80D of the Income Tax Act allows the benefits up to Rs. 50,000. Especially for the salaried people who fall in the category of taxpayers, a health insurance policy can be a very good option to save some money along with getting health benefits.
Just like the list of getting all of the favorite things, adding health insurance will also yield some very good results at the time of the need. Getting a policy is not any difficult task anymore, the younger generation or the tech-savvy people can easily get a policy for themselves through the online route and there will be absolutely no need for any broker or commission expenses.
Frequently Asked Questions
No one wants to invest their hard-earned money somewhere where they remain unsure about the benefits they are liable to get. Before investing, there are a lot of questions that come up in everyone’s mind and to clear the confusions, it’s very necessary to address them and consult them to an expert. Some of the very general questions that are asked by the customers are:
What will happen to the policy if the policyholder who had opted for a family plan dies?
If the person was hospitalized and died in the hospital, all the expenses will be covered under the plan and the family will get full reimbursement. If the policyholder was also the eldest in the family and more than two persons are enrolled in the policy, the premium will be set again according to the age of the next person who is the oldest of all.
Also, if the policy only accommodates two people, the plan will get converted into an individual plan.
What are the important factors I look at before making the purchase?
The things you must look at before purchasing any health insurance policy are:
- The number of people the policy is willing to provide the insurance for.
- The type of insurance cover, individual, family, or both.
- The total sum insured, an individual should consider a policy good if it’s providing at least 8-10 times of his/her annual earnings as the cover amount.
- Before making the final purchase, the factor that’s a must to look after is if the policy is coming with a cap amount.
- The list of hospitals that are enrolled in the network of the insurance company also plays an important role in judging a policy.
- Always clarify any point in the terms and conditions if it’s creating any confusion. Never make any assumptions.
What if I need to increase the total sum insured of an ongoing policy?
Many insurance companies provide the top-up facility where the individual has the option of getting the policy amount risen by filling up a form at the time of renewal. This is the factor that the person should look after at the time of the purchase of the policy will allow him/her in the future to do so.
Am I eligible to get reimbursements for maternity expenses?
No. The insurance policies don’t consider maternity expenses in the list of their inclusion criteria. A health insurance policy generally only covers unexpected expenses. However, some insurance companies are now providing the service of covering maternity expenses on a bit higher premium. The trend is yet to be adopted by a whole lot of insurers.
Can I have the option to cancel the policy and get a refund?
The insurance companies provide a time duration of 15-20 days to understand all the clauses and decide if an individual wants to go further with the policy or not. If a person encountered any clause that he/she thinks is not good or suitable, the objection can be made within the specified time and the full refund will be made to you. Ask the company about the allowed cancellation period and then finalize the purchase.
Can I have more than one health insurance policy?
Yes, a person can have as many policies as he/she wants. If that person is capable of paying that many premiums, he/she can get as many policies.
Is the policy that I enrolled for is valid all over the country?
Nobody knows the time and place when he/she will need a medical requirement. Most of the policies cover this clause and provide the coverage anywhere a person gets hospitalized, the only condition is that the hospital must be on the network of the insurance company.
The clause is generally covered by most insurance companies. An individual must make sure that the cover is not limited by any geographical condition. Check if any states/regions that are excluded. Some insurance companies also provide the benefit of covering health expenses in some foreign countries as well.
What are the provisions of discount on renewal?
Some companies offer a discount on the premium for the next year if you have not made any claim in the year. The discount is also known as a no-claim bonus which is given by a lot of companies and it came in trend only a couple of years ago.
Some companies also offer some complimentary benefits such as free check-ups, etc. once a year. The companies offer these complimentary check-ups to every policyholder, no matter if he/she made any claim in the previous year or not.
Will I get the reimbursement if the hospitalization duration is not even a full day?
Yes, the claim will be fully entertained. This service is known as Day Care Treatment. Many technological inventions can easily provide a person the benefit of getting treated in less than 4 hours, which earlier used to take 2-3 days along with intensive care.
However, a person must not assume that this is a service that is given by all the insurance companies. There are a lot of insurers that only provide OPD coverage which requires hospitalization for more than one day.
What will happen if the policy exhausted during hospitalization?
In such cases, if you informed about the situation to the insurance company, the company will be liable to pay all the benefits according to the plan you chose and its terms and conditions.
There can be two cases regarding the exhaustion, first is the policy got expired, and second, the expenses exceeded the sum insured. In both cases, the insurance company will provide that person all the benefits of health insurance.