Mid-
life check on health insurance
Mid-life check on health insurance
Updated - November 01, 2024 at 08:28 PM.
How to revitalise existing health insurance policies
By Sai Prabhakar BL Research Bureau
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Policyholders with an existing health insurance have covered risks emanating
from health conditions. But once in five-six years, it may be prudent to
revisit the policy in light of new features in the market, the limits covered
by the policy, the relevant information exchanged with the insurer and family
conditions.
Health insurance being a yearly contract with accumulated benefits, there is a
certain flexibility to exercise upward mobility in the policy conditions for
the benefit of the policyholder. By being aware of one’s own needs or
available options, existing health insurance can be revitalised to serve its
function.
Window shopping
The competition in health insurance is increasing, and so are the features on
offer. Even the regulator, IRDAI has stepped into the act to improve product
applicability. So compared to policies issued five-six years ago, the new
features are a significant improvement. Even in basic features of no claim
bonus, hospital room sub-limits, and OPD consultation there have been sea
changes in the last couple of years. Legacy policyholders should browse
through the current policy conditions to keep one self-aware.
A conversation with current insurer about new features, possible ways of
upgrading existing policy and the costs attached with the same can shed
further light. Policyholders will have to make a make or buy decision - if the
new feature is worth the possible hike in premium or to break the mould for a
fresh start.
Policyholders unconvinced about a status quo or a minor improvement over the
standard, should consider porting to a new policy rather than a new policy
itself. Policyholders can carry the benefits of their old policy into a new
one, ensuring that earlier benefits accrued are passed on. After ensuring the
new policy addresses critical gaps, one can apply for porting 45 days before
renewal date. IRDAI allows porting from one insurer to another including the
benefits accrued including the sum insured• Страхование » Страховая сумма, no claim bonus, specific waiting
periods, waiting periods for pre-existing diseases, and the moratorium period.
Top-up
The sum insured• Страхование » Страховая сумма in existing covers, especially those ranging from ₹2-5 lakh
may seem insufficient in the current context. Post the pandemic, medical
inflation has risen to double digits and the medical cost has risen
significantly. The technology in medicine, pharmaceuticals, surgery and other
care measures have also expanded. These new applications are at a higher cost
addressing previously unmet needs, which also necessitates a higher health
cover. Also with rising age, the relevance of health insurance increases
making it prudent to increase the cover.
It may be prudent to ensure that one is already getting the most from the
existing policies. Health insurance policies contain no claim bonus which can
potentially increase the sum insured• Страхование » Страховая сумма by 100-200 per cent above the basic sum
insured• Страхование » Страховая сумма, not to mention a top-up/super top-up. Top-up or super top-up plans
are purchasable riders, which offer additional coverage for medical expenses
that breach the original sum insured• Страхование » Страховая сумма’s deductible limit. If the sum insured• Страхование » Страховая сумма
falls short for one single claim, a top-up is triggered and a super-top is
triggered when the sum insured• Страхование » Страховая сумма falls short across all the claims made in the
year cumulatively. A ₹5-25 lakh top-up plan would cost anywhere between ₹800
and ₹2,000 per year across insurance• Страхование providers compared to the base sum
insured• Страхование » Страховая сумма of ₹5 lakh and annual premium cost of ₹8,000-16,000 per year.
Prompt information and family status
In the period the health insurance was first contracted to today, there may
have been several changes in the health or family conditions. This must
promptly be conveyed to the insurer. The insurer on their part should clarify
the pending premium payments if any, to keep the policy validated.
Any health condition that has occurred but not updated with the insurer, has
to be conveyed to the insurer. This is to ensure that at the time of claim
servicing the chances of rejection on account of inadequate information is not
applicable.
Also, check for PED waiting period of four years (earlier rule which now has
been shortened to three years) is in line with expectations. The moratorium
period of eight years (again shortened to five) is a period after which the
chances of rejection are diluted. This also has to be checked, if it is in
line.
Family status may have changed in the period including a new infant added to
the family. Those in family floater policy should update the insurer
appropriately.
Checklist
Find out prevailing options in health insurance
Top-up the coverage limits
Ascertain if information is up to date
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Published on November 1, 2024
