Understand Sub-Limits In Your Health Insurance Plan

Anup Goyal was diagnosed with a disease and was advised by his doctor to go for a surgery. The doctor told him that he needs to be hospitalized for almost 10 days. Everybody suggested Anup to go for an affordable hospital, but Anup planned for an expensive hospital to have a royal treatment  because he thought his health insurance policy will cover everything. He planned the surgery, informed the Third Party Administrator, took leave from his office and went for the surgery. After 10 days, he was discharged from the hospital after a successful surgery, but soon the happiness of getting cured was overcasted by huge hospital bills which he has to pay from his own pocket and his policy covered only a portion of the total hospital bill.

This happened because Anup was not aware about the sub-limits of health insurance policy and he thought that all the hospital expenses will be covered under his policy, regardless of the price. So let us understand sub-limit of health insurance policy through this article, so that you will not have to suffer like Anup.


You buy a policy with health insurance benefits with a particular sum assured, but the insurance company segregates that amount into various sub-limits. In simple words, it limits its liability to pay you in certain cases. For example, you may have a total sum assured of Rs. 5,00,000/- but your insurer might have put a sub-limit of Rs. 20,000/- on the cataract surgery. This means that the insurer is liable to pay you only Rs. 20,000/- as an expense of your surgery, no matter what the actual costs are! There are various other kinds of sub-limits on different surgeries, treatments, room rent, etc. Out of these, room rent is one particular sub-limit that can single-handedly bring your financial calculations to nought if not taken care of!

Room Rent Sub-Limit:

Different hospitals have different tariffs for different rooms and the total expenses including doctor’s visit, medical tests, etc. vary proportionately according to the room rent you’re paying. The health insurance companies in India are aware of this practice and that’s why they put a limit on the room rent, as per your policy and the premium you’re paying.

For example, you might have a room rent, sub-limit of Rs. 4000/- as per your policy, but if you take a room with the rental of Rs. 6000/-, then the balance Rs. 2000/- will have to be paid from your pocket. Also, in a hospital, the charges are levied according to your capacity to pay. So in a twin sharing room, surgery might cost Rs. 15,000/-, but in a single room it might cost Rs, 25,000/-. Similarly, the doctor visit charges and every expense for the treatment, except for the cost of medicines, will be charged differently. If you’re not aware of the sub-limits, the health insurance benefits of the policy will hold no value for you.

Let’s help you understand what happened with Anup:

His Sum Assured:                    Rs. 5,00,000

Room Rent Limit:                    Rs. 3000

Actual Room Rent:                  Rs. 5000

No. Of Hospitalization Days:       10

This is how his final bill was calculated:

Actual Bill                               Reimbursed Amount

Room Charges                       Rs. 50,000                         Rs. 30,000

Doctor’s Visit                          Rs. 20,000                         Rs. 12,000

Medical Tests                         Rs. 20,000                         Rs. 12,000

Surgery Costs                         Rs. 2,00,000                      Rs. 1,20,000

Medicines                                Rs. 15,000                         Rs. 15,000 (Actual as per MRP)

Total                                           Rs. 3,05,000                    Rs. 1,89,000          

The cost borne by Anup:  Rs. 1,16,000/ as the other expenses like a doctor’s visit, medical tests, etc.  are also proportionately reimbursed which are linked to the room you have chosen.

Sub Limit on specific treatment

There is a sub limit on specific treatments which is mentioned in the policy details. You should always check the list of such ailments which falls under the sub limit clause of the policy. So even if you have a very high sum insured under your health insurance policy, it may happen that you will not be able to claim for your full hospitalization expense because of the sub-limit clause.

For example- If the sub limit clause on cancer is 50% of the total sum insured, then even after having a sum insured of Rs.5 lakh, you will not be able to claim for more than Rs.2.5 lakh for the treatment of cancer.

Health insurance companies in India inform everything about the plan and sub-limits in detail in the policy documents. It is up to you to read and understand them and act accordingly at the time of hospitalization. Ensure that if you have any queries, get them cleared with your insurer before hospitalization to know about the limitations. Only being aware of the total sum assured can spring up surprises that are enough to nullify any benefits you were expecting from your health insurance plans.

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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