Why do Most Health Insurance Policies Fail?

The biggest complaint that a policyholder has against health insurance plans is that even after paying huge amount of premiums to buy a plan, it still didn’t come handy when needed the most. At the time of medical emergency, the most common sight is that of people being declined their claims or health insurance not providing enough coverage to meet the requirements. It is obvious to curse the insurer, but most of us forget that sometimes the fault lies with us also. If not with us, then the circumstances related to the whole process of buying health care insurance.

Basic Mistakes due to Health Policy Fails

Enlisted below are some of the basic mistakes due to which a health policy fails to do its job:

1. Lack of Awareness

Insurance is still an evolving market and not many people are aware about the health plans’ existence, leave aside the various options available. Therefore, the first plan they come across, they buy it without giving it a serious thought. As most decisions to buy a policy are based under compulsion by peer pressure or insurance agents’ selling tactics, a customer makes the wrong purchase.

2. Tax Purposes

There is a widely held belief that buying insurance is important for tax relief. Therefore, one only looks at the premium that needs to be paid to save taxes without checking out whether the policy will cover medical expenses in the time of need or not. For example, a buyer might think that he had bought the best health insurance policy by paying a premium of Rs. 15,000/-, but he might not even check if it covers any pre-existing diseases or if the plan provides for the pre and post hospitalization expenses. This can prove costly later on.

3. Medical Cover

The cost of medical treatment is going through the roof these days and without adequate cover even the best health insurance policy is good for nothing. Having a health plan for the sake of it does nothing for you. For example, you bought a health plan with a cover of Rs. 2 Lacs, but an angioplasty or a cardiac surgery will easily set you back due to its costing of Rs. 5 Lac including all costs. Despite having a medical cover, it is not of much use.

4. Low Premiums

We try to save costs everywhere and think that lower premiums on health insurance would mean a great deal! The truth is that lower premiums would mean lesser benefits as well. The insurer might not cover you for certain diseases or may not provide you for pre and post hospitalization expenses or may put a cap on your expenses for certain surgeries. During such times, the health care insurance you bought would be nothing but a piece of paper.

5. Terms and Conditions

It looks boring to go through detailed terms and conditions, which are technical in nature. However, without knowing what we are signing up for and understanding our rights and duties, how can we be assured of a great deal? For example, some insurers have a waiting period clause. This states that in case of pre-existing diseases, the insured needs to wait for at least 1 year from the time of commencement of the policy, before he can file for a claim. If you didn’t know about it and still filed the claim, it will be rejected and you won’t be able to do anything about it.

6. Agent’s Priorities

Most insurance agents will sell you policies that fetch them higher commissions. If you don’t compare health insurance policy and blindly trust your agent, you might be in for a rude shock. His priority is his profits, not your health! He will sell you the policy as per his priorities, not as per your requirements or expectations.

7. Research

Many of us feel lazy to find out about insurance products on our own. That’s where the biggest mistake lies. It is advisable and the right thing to do to find about your requirements on your own. After you know what you want, find out about the various options available online. All information is available on the internet at the click of a button that you can go through, understand and then take a decision. Compare health insurance policy to find out the best deal at lowest prices and then choose the best plan for you and your family. You don’t have to go anywhere and can buy a policy anytime from anywhere in the world!

Avoid these mistakes and enjoy the benefits that health care insurance plans have to offer. They are made to help you face financial hardships during a medical emergency. Ensure that you are extremely careful while buying them. It’s your health after all and precaution is always better than cure, isn’t it?

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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