Taking a health insurance plan is important in India due to the rapidly rising medical costs and increasing prevalence of lifestyle diseases. According to recent studies, medical inflation in India is among the highest in the world, averaging at around 12-15% annually. This makes it difficult for individuals to pay for medical expenses out of pocket, especially in cases of serious illnesses or hospitalization.
Additionally, there has been a significant rise in lifestyle diseases such as diabetes, cardiovascular disease, and obesity in India due to changing dietary habits and sedentary lifestyles. This has further fueled the need for comprehensive health insurance coverage to mitigate the financial burden of medical treatment.
A health insurance plan can provide financial security and peace of mind in the face of rising medical costs and the increasing incidence of lifestyle diseases in India.
Things to consider before buying health Insurance
1.Individual policy vs Floater: Individuals should carefully consider their needs, budget, and medical history when deciding whether to purchase an individual health insurance policy or a family floater policy. If you have a large family, a family floater policy may be the more cost-effective option, but if you have specific health needs or prefer customization, an individual policy may be a better choice.
2. Sum assured: The cost of healthcare in urban and expensive cities such as Mumbai is generally higher than in other places due to a number of factors such as higher demand for healthcare services, higher cost of living, and higher cost of medical treatments and procedures. A higher sum insured in a health insurance policy is especially important for individuals living in urban and expensive cities such as Mumbai, where the cost of healthcare is higher. This will ensure that policyholders have adequate coverage for unexpected medical expenses and can focus on their recovery without worrying about financial constraints.
3. Top Up: A top-up policy in health insurance is a type of supplementary insurance coverage that provides an additional layer of protection over and above the existing basic health insurance policy. It is designed to provide extra coverage in cases where the sum insured under the basic policy has been exhausted. A top-up policy can provide a cost-effective and flexible way to enhance an existing health insurance policy, thereby providing individuals with additional financial protection against rising medical costs.
4. Cashless Claim: Cashless claim in health insurance is a feature that allows policyholders to receive medical treatment without paying out-of-pocket expenses. Instead, the insurance company directly settles the medical bills with the hospital. A cashless claim in health insurance offers numerous benefits, making it a convenient and cost-effective option for policyholders in the event of a medical emergency.
5. No claim bonus: No claim bonus (NCB) is a discount offered by health insurance companies to policyholders who have not made any claims during the policy term. The discount is usually in the form of a higher sum insured or a lower premium for the next policy term.
For example, if a policyholder has a health insurance policy with a sum insured of Rs. 5 lakhs and does not make any claims during the policy term, they may be eligible for a 10% NCB for the next policy term. This means that the policyholder's sum insured for the next policy term will increase to Rs. 5.5 lakhs, or their premium for the next policy term may be lower by 10%.
6. Waiting Period: Waiting period in health insurance is the time that must pass before certain benefits under the policy become effective. The waiting period is usually applied to pre-existing medical conditions, specific treatments, or surgeries. For example, if a policyholder has a pre-existing medical condition such as diabetes, the insurance company may impose a waiting period of 2-4 years before coverage for that condition becomes effective under the policy. Similarly, there may be a waiting period for coverage of specific treatments or surgeries such as a joint replacement or cataract surgery. The purpose of the waiting period is to prevent policyholders from immediately making a claim for a pre-existing condition and to reduce the overall cost of insurance for the policyholder and the insurance company.
7. Co-payment: Co-payment in health insurance refers to the portion of the medical expenses that the policyholder has to bear. It is a pre-determined fixed amount that the policyholder pays at the time of availing medical treatment, and the rest of the cost is covered by the insurance company. The amount of copayment varies from policy to policy and can be a percentage of the total claim amount or a fixed amount.
In general, health insurance policies in India with lower premium rates usually have higher copayment amounts, while policies with higher premiums have lower copayments. The purpose of copayment is to encourage policyholders to be more responsible in their use of medical services and to control the overall cost of healthcare.
8. Waiting Period: a waiting period in health insurance refers to the time frame during which a policyholder is not eligible to make a claim for a specific medical condition or procedure. This waiting period is usually applied to pre-existing illnesses and certain procedures, such as maternity benefits.
The purpose of the waiting period is to prevent policyholders from immediately making a claim for a pre-existing condition, which could significantly increase the insurance company's expenses. The waiting period typically ranges from 2 to 4 years, depending on the insurance policy and the condition in question.
It is important for individuals to carefully review their insurance policy to understand the waiting periods and what medical conditions are covered and not covered during this period. In general, the longer the waiting period, the lower the premium for the policy.
9.Cashless Claim: Cashless claim in health insurance refers to a facility offered by insurance companies, allowing policyholders to receive medical treatment without having to pay for it upfront. Instead, the insurance company directly settles the medical bill with the hospital.
To avail of this facility, the policyholder must be admitted to a hospital that is part of the insurance company's network of cashless hospitals. In case of an emergency, the policyholder can be admitted to any hospital, and the insurance company will reimburse the expenses incurred, subject to the terms and conditions of the policy.
Cashless claims provide policyholders with the convenience of not having to pay for medical expenses out-of-pocket and eliminates the need for lengthy reimbursement procedures. It is a useful feature that can provide peace of mind and financial security during a medical emergency.
10. Pre and Post Hospitalization Cover: Pre and Post Hospitalization Cover in health insurance refers to the coverage provided by insurance companies for medical expenses incurred before and after hospitalization.
Pre-hospitalization cover refers to the coverage for medical expenses incurred during the period leading up to a hospitalization, such as diagnostic tests, consultations with specialists, and medications. The coverage period for pre-hospitalization expenses usually ranges from 15 to 30 days prior to hospitalization.
Post-hospitalization cover refers to the coverage for medical expenses incurred after a hospitalization, such as follow-up visits, rehabilitation, and home care. The coverage period for post-hospitalization expenses usually ranges from 60 to 90 days after discharge from the hospital.
Pre and post-hospitalization cover helps policyholders to mitigate the financial impact of medical expenses incurred before and after hospitalization, providing them with peace of mind and financial security during a medical emergency. The extent of coverage and the terms and conditions vary from policy to policy, so it is important for individuals to carefully review their insurance policy before purchasing.
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