Finding out how to choose the right health insurance policy in the Indian context is easy. Nevertheless, it does call for some study before you write out that premium cheque. The reason: it’s not just the initial premium amount that you are paying. You implicitly commit to pay premium for the years ahead too, expecting good service from the same insurance company in case, God forbid, you need to file a claim. The thumb rule to go by here is, “Ensure before you insure.”
In this article, we share five tips you will find helpful in making an informed decision while scouting for a health insurance provider, as also while choosing the right health insurance plans for your family.
1. Decide your Sum Insured
The sum insured is the total coverage amount for which you pay a premium. What is the health coverage you are looking at? A good way to decide is this: in case you are hospitalized for a heart bypass surgery or kidney transplant, what would the likely total hospitalization bill be? Let’s say it could be Rs.2, 50,000. In that case, you should choose the sum insured as slightly higher than that amount; e.g. Rs.3, 00,000.
This is just the basic health coverage though. Insurance companies offer add-on benefits, called riders. The catch here is that as you keep topping up your sum insured with add-ons, your premium amount keeps increasing.So you need to weigh if the add-ons are worth the extra premium. For instance, there is no point opting for a health insurance policy add-on that also covers appointments with the dentist, ophthalmologist, etc. These costs tend to be moderate, when compared to hospitalisation bills. So it makes sense to go for a basic, uncomplicated health insurance plan.
2. Individual or Floater – Make Your Choice
Insurance companies nowadays offer plans for individuals as well as family units. Such family unit plans are called floater plans. They can help you save money by having a common sum assured for those covered. The assumption here is that usually, at any given time, only one of the family members falls sick enough to need hospitalisation. But you do not know beforehand who that person might be. So you pay premium to cover all these family members. Yet, because the sum insured is the same as what you might have chosen for an individual health insurance policy, the insurance company does not need to commit a higher benefit to you.
Here is a table that clearly lays out the difference in premia for individual and floater policiesfrom a fictitious XYZ General Insurance Company, where the primary policyholder’s age is 35 years and the sum insured is Rs.3,00,000:
Floater Plan for 2 Adults + 2 Children
The table shows that the premium does not quadruple simply because there are four insured family members instead of one. It simply doubles. It’s a win-win situation for the policyholder as well as the insurance company.
3. Check Upper Age Limits
Two aspects are involved here – the upper age limit for buying a new policy, and the upper age limit for renewing your policy. Insurance companies generally sign-up senior citizens up to the age of 80. Some companies though, especially private ones, have low age limits. While some providers offer lifetime renewal, others cap it at 70 or 75 years. Of course, the higher the age limits the better, as then you need not worry what will happen if you fall sick when you are 85 or 90. Needless to say, the premium amount gets higher too, as you age.
4. Research Claim Fulfillment
Besides the health insurance plan itself, you must do some background check on the insurance companies too.Do they have a good record of fulfilling claims, and to what extent? If your sum insured is Rs.3,00,000, and so is your hospital bill, you might not get a 100 percent settlement. You could get a reimbursement of up to 80 percent or sometimes less. It depends on the policy’s clauses.
Another point to check is which hospitals the insurance company has a tie up with. Also, do they offer a cashless hospitalisation facility? This can be a real advantage as then you do not need to worry about daily cash withdrawal limits at ATMs or stacking up hard cash in your house.
5. Research Client Servicing
Insurance companies either service your policy directly or through intermediaries, either agents or Third Party Administrators (TPAs). A TPA helps the policyholder by issuing identity cards they can show at the time of admission to the hospital. They also assume responsibility for other client communication. Even apart from a TPA, the insurance company must have a good track record of servicing their clients, be it through toll-free helplines, efficient client-facing staff at branches, speedy email communication, speedy and accurate claim settlement, etc.
Again, be sure before you insure.Take care of the points discussed here before choosing your insurance service provider and the right health insurance policy.This way, you can rest assured that in case of hospitalisation, you can focus all your attention on quality treatment and speedy recovery, rather than be anxious about arranging money to foot the bill. To end on a light vein, don’t ‘foot’ the bill – instead, ‘hand’ the bill (to the TPA, agent or insurer) and come back home to peace and good health!