Five elements you can’t skip before finalizing your Health Plan

Rohan, is a marketing guy who is very smart professional when it comes to marketing his company’s products. Lately, he has got hospitalized due to the dengue fever in a private hospital near his place. The cost came out to be Rs 65,000 which unfortunately has to be borne by him only as he did not have a health insurance policy. However, this incident made him understand the importance of a financial back up for his health in the form of a “Health Insurance Plan”. He decided to buy a one for himself and his family. But being a layman, he did not know what are the important things to be considered before buying a health insurance plan.

Here is a guide which emphasizes on the 5 important parameters to be looked upon before you actually make a final buy of a health insurance plan.

1. Scope of Coverage

It is important to assess and evaluate the scope of coverage. Buyers may assume that purely buying a health insurance is enough and suffice their health care requirements. Buyers buying a health insurance plan simply on the basis of premium, assuming “cheaper is the better” might end up limiting their scope of coverage. It is important to have a health insurance with a robust sum insured which is the maximum limit of getting a benefit under a health plan. Rising medical costs can be combatted by opting for a sum insured large enough to substantiate the claim amount without making you pay out of your pocket.

Also, the scope of coverage needs to be looked upon as per your need, requirement,existing cover (if any), family size, previous medical history, etc. Look for the comprehensive coverage which offers you benefits suiting your specific case. Like for example, in case you are opting for a family floater plan, look for the benefit of the sum insured restoration (recharge of your sum insured in case it gets finished in a policy year), if you are looking for a maternity benefit, look for a health plan offering maternity benefits and so on.

2. Room Rent Capping

It is important to check and assess the restrictions or upper limits in the form of capping and sub limits before you buy a health plan. There are certain restrictions with regard to the benefits payable related to the coverage under the health insurance plan. Room rent is the per day benefit given to you when you are hospitalized as per the eligibility under your health insurance plan. Traditionally, the capping of the hospital room rent is 1% to 2% of the sum insured on per day basis. Health insurance plans lately do offer “single private room” or the option to “upgrade your room” or some plans offer “no capping” on the room rent. Usually health insurance plans with higher sum insured, offer the latter two options.

Thus, it is important to ascertain the room rent eligibility under your health insurance plan before you finalize the plan. With medical inflation skyrocketing, getting treatment in private hospitals has become expensive and so is the hospital room charges. Try and check the hospital room rents for your preferred hospitals and match up with the room rent eligibility under your shortlisted health insurance plan which will give a fair idea.

3. Cashless Hospital Network

Cashless hospitalization is a seamless procedure which makes the hospitalization easy in your troubled time to seek healthcare. You just have to show your health card issued by the insurance company and hospital admission is almost done. But all hospitals may not be partnered with the insurance company to offer you such hassle free treatment.Thus, to have a look at the list of cashless hospitals empanelled with the insurance company is important. Out of the list, it is crucial to see your preferred hospitals. List of cashless hospitals may include 6000 or 8000 plus hospitals, but such an exhaustive list is of no use until it includes the hospitals, which are nearer to your vicinity or your ideal ones for treatment.Treatment in non network hospital might attract co-payment (specified portion of the claim amount to be borne by you) and cashless treatment will not be available. You have to spend the treatment expense from your own pocket and later claim reimbursement from your insurer by submitting all relevant bills and documents timely.

4. Claim settlement record

Claim settlement record is an important aspect which cannot be skipped. How many claims have been settled by the insurance company is important to be known as it reflects the inclination of the insurance company towards claim settlement of genuine claims and assures you that your claims and reimbursements would not be wrongly withheld. A consistent and healthy claim settlement ratio is which one must look for before finalizing an insurance plan from the respective insurance company.

5. Co-Payment

Co-payment is your co-share in the claim amount. Co payments are of 2 types voluntary and mandatory. As the name suggests, voluntary co-payment is opted by you as an insured and mandatory is compulsive, co-payment which is there in the health insurance plan.Co-payment is expressed as specified percentage of the claim amount. By opting voluntary co-payment, your premium will tend to be reduced by the insurance company as you are bearing a responsibility to share the claim amount in the predetermined percentage.Voluntary co-payment must be chosen if you are young,healthy individual as then the probability of claiming from a health insurance policy reduces. Don’t fall prey to the fact, blindly that your health insurance reduces by opting voluntary co-payment.  But, the surprise comes when you are unaware of the co-payment clause in your health insurance policy at the time of claim. So, it is imperative not to skip this clause.

In a nutshell, the coverage amount needs to be assessed appropriately by the number of people that you want the policy to cover, your estimate of the health care costs and the existing coverage that you might have from other sources like employee provided group insurance. Healthcare inflation is increasing at a very high rate of 20% so go for a higher sum insured if affordable. Don’t fall prey to perceived value rather spend some time comparing plans and its coverage before you finalize your best buy.

Harjot Singh Narula

Harjot Narula is founder and CEO of ComparePolicy.com, an IRDAI approved insurance web aggregator focussed on selling online insurance for companies. Harjot has more than a decade of experience in software development and has also spent 5 years in US working for the mortgage and risk management industry.

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