Seven Secrets to Choose the Best Health Insurance Plan

The cost of medical treatments and other associated costs are increasing day by day and hence having a good health insurance plan has never been more essential. Medical expenditure is something that comes unannounced. It can burn a hole in your pocket even before you realize. Therefore, planning for the unforeseen is extremely essential.

The big question is how to know which health insurance policy is the right one for you. Currently, out of total 30 general insurance companies, 28 companies provide health insurance plans in India and the health care benefits of each one is different. Therefore, choosing the right kind of health insurance plan is a mammoth task, especially if you are not well-versed with medical complicacies.

To help you make the right decision, we have put together useful seven points to look for to decide the right health insurance plan for you and your family:

Insurance Issuer

Out of the 28 insurance companies which offer health care benefits today in India, not everyone is as trustworthy. Do a thorough research of crucial factors like the company’s background, management, hospital network, claim settlement ratio, claim process, etc. to be sure that the issuer stands by you when you need them more. The claim settlement ratio is one of the most important factors to consider. The claim settlement ratio indicates how many claims has the company settled in a given year. A low claim settlement ratio means the company mostly refuses claims. Go for companies which have a higher claim settlement ratio.

A small tip from our end. It is always better to go for an issuer which exclusively deals with general insurance rather than an issuer which deals with both life and general insurance. It has been found that the cost of obtaining insurance from issuers, which offer general insurance only is usually lower.  

Coverage

First and foremost, decide on the coverage that you want to take and then look for the health insurance plan with the right coverage. Take an individual policy if you are single, however, take one where you have the provision of adding family members in the future. A family floater policy works best for married people with kids. In case you want to cover your parents, take a separate policy for them since in case of a family floater policy, the premium is decided by the maximum age of the beneficiaries.

Inclusions and Exclusions

Read the brochures, do online researches and know the policy you are purchasing in details before you make your final decision. In most policies some pre-existing diseases are excluded in the first few policy years. Some policies exclude certain medical procedures in the initial years. This is known as a waiting period. Choose one which has the lowest waiting period, although it might come at a relatively higher cost. You must know all these from beforehand rather than coming to know about it after you have actually incurred the cost.

Limits and Sub-limits

Every policy has various limits and sub-limits with regard to specific diseases, it is very important to know them rather than getting surprised at the last moment. There are usually sub-limits with respect to a variety of aspects with regards to treatment like doctor’s fees, diagnosis, room rent, etc. In most policies, there are also limits with regards to the maximum reimbursement for certain procedures like appendicitis, hernia, etc. You will have to pay from your pocket if the expenditure exceeds the limit. Therefore, it is very important to know what is the limit for a procedure before actually incurring the cost.

Payment Terms

In health insurance plans, there is a concept of Co-payment. In most cases, 100% of the cost is not replenished by the insurance company, a certain percentage of the same has to be borne by you. This percentage can vary from as low as 10% to as high as 40%. It is important to know what is the co-payment percentage, and go for one where the co-payment percent is the lowest.

Renewal Terms

In most cases, the health insurance plans can be renewed till 70 or 80 years of age. This is unfortunate since medical costs go up as we get older. Do check thoroughly what is the maximum renewal age of a policy and go for one which has the maximum renewal age. Usually, the ones with high renewal age are costlier. But this is a worthwhile expenditure and is definitely recommended.

Cost

Buying health insurance plans are an essential cost which cannot be avoided. We would definitely recommend to keep cost as the least important priority and look at health care benefits only. However, do a cost benefit analysis before making the final decision.

Read our article “Top 10 Health Insurance Companies in India” for understanding more about Health Insurance.

Choosing the right health insurance plan is important. Doing an early research will help you avoid sudden surprises especially with regards to medical bills. We recommend spending considerable time in researching before making the move.

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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