Health insurance: Nine points to help you make a smart choice

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The pandemic has demonstrated the need for adequate health insurance coverage more than ever. Most insurance companies are offering attractive features. But before buying one, you should go through all the details. Unless one has specific domain knowledge, almost none of us understand all the terms and conditions associated with insurance. Money9 brings a 9-point easy guide that would help you in buying appropriate health insurance.

Minimum, maximum sum insured

The minimum sum insured under the health insurance plan will be Rs 1 lakh and the maximum sum insured limit would depend on the buyer’s capacity to pay a premium. In the case of an individual health policy, the sum insured will apply to an individual whereas, in the case of a floater health insurance plan, the sum insured will apply to the entire family.

Eligibility age

The minimum entry age is 1 year and the maximum age at entry is 65 years. For senior citizen schemes, the entry age is up to 80 years. However, there is no exit age. Policies are subject to lifelong renewability.

Modes of premium payment

All the premium payment modes are available. You can pay the premium either annually, half-yearly, quarterly, or even monthly. There will be uniformity in premium pricing.

The premium is on a pan-India basis. No geographic location/zone-based pricing is allowed.

You can pay it through cheque, cards, net banking and through UPI medium.

Cumulative bonus

Sum insured (excluding bonus) will be increased by 5% in respect of each claim-free policy year, provided the policy is renewed without a break subject to maximum of 50% of the sum insured.

If a claim is made in any particular year, the cumulative bonus accrued may be reduced at the same rate at which it has accrued.

Grace period for premium payments

For yearly premium payment mode, a fixed period of 30 days is to be allowed as a grace period. However, for all other modes of payment, a fixed period of 15 days grace period will be allowed.

Expenses covered

All the expenses incurred on the treatment of any diseases are generally covered by health insurance. Pre and post hospitalisation, OPD consultation free, medicine bill, pathological expenses, etc all are covered in insurance.

The expense of cataract will be covered up to 25% of the sum insured or Rs 40,000 whichever is lower, per eye. Dental treatment necessitated due to disease or injury, plastic surgery necessitated due to disease or injury, all day-care treatments and expenses are covered in health insurance.

Member

One can add his/her spouse, 2/3 children, parents, and in-laws. Dependent children between 3 months and 25 years are eligible. If the child is above 18 years of age and is financially independent, he or she will not be eligible for coverage in the subsequent renewals.

Freelook period

The insured will be allowed a period of at least 15 days from the date of receipt of the policy to review the terms and conditions of the policy and to cancel the policy if not acceptable.

Co-pay

Fixed co-pay of a minimum of 5% on all claims will be applicable across all ages. In simple words, the co-pay in health insurance is the percentage of the claim amount that is borne by an insured person, under a health insurance policy. However, the rest of the amount will be paid by the insurer.