you compare health insurance plans on Insurance web aggregators (Like Policy bazaar), you will find almost the same features in all of them. So, you might get confused & fall in the trap of the cheapest plan or suggested by an agent without knowing complete policy wording. So, here I am summarizing all you should know about the health insurance plan with emphasis on hidden Terms & Condition.
Points to Note:
- The rate of increase in sum insured limit will differ in different Plans of the same insurer & also from 1 insurer to another. Faster the rate, better it will be.
E.g. Apollo Munich (Now HDFC Ergo) optima restore plan gives NCB as a 50% increase in SI
- Max. the cap of increase in SI. Higher is better. Some plan gives max. up to 50%, some give up to 100%
- Penalty for taking a claim. Whenever you take claim in a year, your insurer will penalize you for it (Usually by reducing accrued NCB by the same rate as of in increase). No penalty or low penalty is better. E.g. Max Bupa doesn’t penalize for taking claim - The majority of PSU insurers (National, united, etc.) don’t provide this feature. - The best thing about NCB is, Increased SI has no extra terms & conditions & it is equivalent to your base plan with higher coverage. So your policy should have this benefit.
E.g. Person detected with cancer & total bill (In single claim or multiple claims – like in chemotherapy cycle) goes above 5 lac, still, he can’t get restoration benefit.
- Can be used in the same person, same disease but with a gap of minimum 45 days
- The single claim in policy year can’t exceed basic SI + NCB (Indirectly saying restoration can’t be used in a single claim however it can be used in a subsequent claim with a gap of 45 days) – E.g. Apollo Munich
My take is, don’t fall in the trap of this benefit. If they are giving it at no additional cost, go for it. Because you can use it for other family members.
1) No Claim Bonus (NCB) / Multiplier Benefit
This is the benefit Insurer gives to the customer for not taking claims in a single year. Unlike vehicle insurance policy where NCB benefit is in terms of discount in subsequent renewal, in health insurance majority of time NCB is in the form of increased in Sum Insured (SI) (Coverage limit of your health insurance).Points to Note:
- The rate of increase in sum insured limit will differ in different Plans of the same insurer & also from 1 insurer to another. Faster the rate, better it will be.
E.g. Apollo Munich (Now HDFC Ergo) optima restore plan gives NCB as a 50% increase in SI
- Max. the cap of increase in SI. Higher is better. Some plan gives max. up to 50%, some give up to 100%
- Penalty for taking a claim. Whenever you take claim in a year, your insurer will penalize you for it (Usually by reducing accrued NCB by the same rate as of in increase). No penalty or low penalty is better. E.g. Max Bupa doesn’t penalize for taking claim - The majority of PSU insurers (National, united, etc.) don’t provide this feature. - The best thing about NCB is, Increased SI has no extra terms & conditions & it is equivalent to your base plan with higher coverage. So your policy should have this benefit.
2) Restoration benefit / Refill benefit
Agents sell policy saying a total of 10 lac coverage (5 Lac base SI + 5 lac restoration). Restoration benefit means once your SI (+ NCB, if any) gets exhausted insurer will refill the same amount as base SI (like 5 lac) once in a year. All hidden Terms & condition lies here. So, read policy wordings & don’t rely on an agent. Like,
- Some insurer has T&C that – Restoration can’t be used in the same person with the same disease (Not even complication of the same disease) E.g. – Max BupaE.g. Person detected with cancer & total bill (In single claim or multiple claims – like in chemotherapy cycle) goes above 5 lac, still, he can’t get restoration benefit.
- Can be used in the same person, same disease but with a gap of minimum 45 days
- The single claim in policy year can’t exceed basic SI + NCB (Indirectly saying restoration can’t be used in a single claim however it can be used in a subsequent claim with a gap of 45 days) – E.g. Apollo Munich
My take is, don’t fall in the trap of this benefit. If they are giving it at no additional cost, go for it. Because you can use it for other family members.
3) Co-pay
Co-pay is the amount in the percentage you have to pay out of your pocket for every claim. Usually, the co-pay plan is offered at a reduced rate compared to the normal plan to attract people. But never go for any plan, which has co-pay.
Beware: Some insurers have the same base plan but if you opt for a discount, they will convert it to a Co-pay plan. E.g. Religare. Religare offers a 15% discount to a customer who opts for a co-pay feature under their Religare care plan. Some of the agents, Including Policy bazaar (Which will always try to sell Religare plan), try to attract customers by saying we will offer a 15% additional discount without telling about this Co-pay. (I fall in the trap of Policy bazaar, thank god I was saved my research. I do complaint against them on twitter too)
Beware: Some insurers have the same base plan but if you opt for a discount, they will convert it to a Co-pay plan. E.g. Religare. Religare offers a 15% discount to a customer who opts for a co-pay feature under their Religare care plan. Some of the agents, Including Policy bazaar (Which will always try to sell Religare plan), try to attract customers by saying we will offer a 15% additional discount without telling about this Co-pay. (I fall in the trap of Policy bazaar, thank god I was saved my research. I do complaint against them on twitter too)
4) Zone/Geography base charges
This might find unusual but many companies Levi Co-pay charges if you change your Zone for treatment. Like if you have taken policy in Agra & if u want to hospitalized in Delhi, then you have to co-pay 20% amount. E.g. Hdfc Ergo policy
In a few insurers, it is optional to choose zone wise charges. Don’t fall in the trap of it to save a few bucks. Because agents might give you Zone B policy at a lower rate & you might end up paying 20% co-pay for taking treatment in Zone A.
Choose Insurer which doesn’t have such geographical/Zonal restrictions.
In a few insurers, it is optional to choose zone wise charges. Don’t fall in the trap of it to save a few bucks. Because agents might give you Zone B policy at a lower rate & you might end up paying 20% co-pay for taking treatment in Zone A.
Choose Insurer which doesn’t have such geographical/Zonal restrictions.
5) Life-long renewal without Co-pay
Some insurers put additional co-pay terms for renewal after the age of 60/65 years. Avoid such plans.6) Sub-limit on room rent
Better to choose a plan which doesn’t have any sub-limits for room rent.
7) Pre/Post Hospitalizations
The higher number of days coverage, the better it is. Like Apollo optima restore gives 60 & 180 days pre/post benefit compare to others who usually give 30 & 60 days respectively.
8) Free health check-up
Don’t get lure with this free benefit. This freebie shouldn’t be the prime deciding factor while making a plan. If this benefit is there it is better.
Some insurer provide Aysuh benefit for full SI E.g. Max
Some insurer provides Aysuh benefit with some capping like max. 20k/50K E.g. Religare
Some insurer don’t provide Aysuh benefit E.g. Apollo
Imp Point: This benefit is only available for hospitalization in Government AYUSH hospitals or NABH accredited private hospitals. Only a few private AYUSH hospitals take NABH.
9) AYUSH Benefit
If you want to get treatment for Ayurvedic/Homeopathy etc. check Ayush benefit.Some insurer provide Aysuh benefit for full SI E.g. Max
Some insurer provides Aysuh benefit with some capping like max. 20k/50K E.g. Religare
Some insurer don’t provide Aysuh benefit E.g. Apollo
Imp Point: This benefit is only available for hospitalization in Government AYUSH hospitals or NABH accredited private hospitals. Only a few private AYUSH hospitals take NABH.
10) Stay healthy Discount
Very nice initiative by some insurers (like Apollo, Hdfc, etc.). If you stay healthy they will provide you an additional discount at renewal. For which you have to download app/wear digital watch & they will calculate daily walking steps & give discount slab wise with max. 8-10%.
Those who are already doing such exercise daily will get this discount & for others, this discount will lure to be healthy.
While some other insurer (like Apollo, Hdfc, Religare, Max, etc.) have their in-house settlement team & don’t have TPA, which fastens the process of claim & refund.
Go for companies without TPA
- Admission should be an in-network hospital, Minimum stay 48 hrs., Room should be twin sharing room, etc. & upper cap is also there, Not valid for ICU admission
- However, if this benefit is there at no extra cost, it's good.
Those who are already doing such exercise daily will get this discount & for others, this discount will lure to be healthy.
11) Waiting period for Pre-existing disease
Pre-existing diseases are covered after 3-4 years (Max, Apollo 3 years, Star 4 years). Shorter the duration better it is. While for the slow-growing disease waiting period is usually 2 years.12) TPA (Third Party Administration)
Many general insurance companies (like National, United, etc.) don’t have their own medical team to verify claim details & they rely on TPA for claim settlement. So, the customer has to deal with TPA first for claim & then TPA approved amount released by Insurer.While some other insurer (like Apollo, Hdfc, Religare, Max, etc.) have their in-house settlement team & don’t have TPA, which fastens the process of claim & refund.
Go for companies without TPA
13) Daily Cash benefit
Over & above your actual claim amount, some insurer gives daily cash benefit for miscellaneous expenses but with lots of T & C like- Admission should be an in-network hospital, Minimum stay 48 hrs., Room should be twin sharing room, etc. & upper cap is also there, Not valid for ICU admission
- However, if this benefit is there at no extra cost, it's good.
14) Exclusion
There is some common exclusion in each policy, which many are not aware of.
- Admission, discharge, record section, RMO, Administrative, registration, service charge, etc. (Many corporate hospital levy Administrative service charge at whopping 15% of total bill amount excluding medicines & these charges are straight away rejected in claim
- Neurological diseases like Parkinson’s, Alzheimer’s disease, etc.
- Circumcision
- The warlike situation, Terrorism, Hazardous activity – like Scuba diving, etc.
- Dental / Eye treatment like Laser
- Stem cell transplant
- HIV, STDs
- Alcohol, substance abuse
- Obesity & its complication (Keep this thing in mind, anywhere during admission if the doctor writes your diagnosis as Obesity – case has gone. Your claim will be rejected) - Maternity (Some plans do offer this benefit but have a long waiting period of 3 years), infertility, birth control treatment, etc. - Robotic surgery, LASER, Light treatment (Remember if you are living in metro cities then some of the sophisticated hospitals do have Da Vinci Robot & they use it frequently – but your insurance won’t cover it) - Non-medical expense (like cotton, loose gloves, etc.) - Apart from this common list, many insurers have added some more exclusions (E.g. Some Specific medicines are excluded) & some blacklisted hospitals. Do check for it.
- Admission, discharge, record section, RMO, Administrative, registration, service charge, etc. (Many corporate hospital levy Administrative service charge at whopping 15% of total bill amount excluding medicines & these charges are straight away rejected in claim
- Neurological diseases like Parkinson’s, Alzheimer’s disease, etc.
- Circumcision
- The warlike situation, Terrorism, Hazardous activity – like Scuba diving, etc.
- Dental / Eye treatment like Laser
- Stem cell transplant
- HIV, STDs
- Alcohol, substance abuse
- Obesity & its complication (Keep this thing in mind, anywhere during admission if the doctor writes your diagnosis as Obesity – case has gone. Your claim will be rejected) - Maternity (Some plans do offer this benefit but have a long waiting period of 3 years), infertility, birth control treatment, etc. - Robotic surgery, LASER, Light treatment (Remember if you are living in metro cities then some of the sophisticated hospitals do have Da Vinci Robot & they use it frequently – but your insurance won’t cover it) - Non-medical expense (like cotton, loose gloves, etc.) - Apart from this common list, many insurers have added some more exclusions (E.g. Some Specific medicines are excluded) & some blacklisted hospitals. Do check for it.
15) Availability of Insurer / TPA office in your city
- In case of reimbursement availability of Insurer nearby to you will be helpful for documentation & if any query arises.16) Network hospital list
- Don’t just check many hospitals. It will be more or less the same in each insurer. But the most important thing is to check whether these hospitals are well-known & according to your preference or not.17) Individual Vs. Family Floater
If you take Individual health insurance for each family member, it will be a costly affair compared to taking Family floater. Suppose three are 3 persons in Family (2 Adult & 1 Child) looking for Sum Insured of 5 lac. The simple reason to understand cost difference is that in Individual policy Insurer is liable to pay max. up to 15 lacs (If all 3 gets sick & put claim), while in family floater Max. liability is only 5 Lacs.
However, as per my opinion, there is a rare possibility (Unless in an accident) that all of the family members need it at a time. So, better to go with a family floater plan with higher Sum Insured at the same rate as compare to Individual plan. In family floater plan children are allowed only till they reach 21 years of age (E.g. Max) or 25 years of age (e.g. Apollo, HDFC).
However, as per my opinion, there is a rare possibility (Unless in an accident) that all of the family members need it at a time. So, better to go with a family floater plan with higher Sum Insured at the same rate as compare to Individual plan. In family floater plan children are allowed only till they reach 21 years of age (E.g. Max) or 25 years of age (e.g. Apollo, HDFC).
18) Pricing
The majority insurer increases the price of premiums in the slab of every 5 years. Like for age 31-35 premium remains the same then increases at 36 age which remains the same till 40 years. However, Max is following an increase in premium every year by 100-200 rs., unlike the sudden rise of premium with age slab changes. So do check it.
Again all hidden T&C are there in these plans. So read carefully before buying it.
Top-up policy – As the name suggests, it is top-up to your existing policy. Let us understand the terminology first. Deductible Amount – It is the minimum amount one has to pay (Either through base policy or through their own) to get triggered top-up policy.
Sum Insured – In top-up policy sum insured includes base sum insured also.
E.g. Your base policy is 5 lac. You have taken a top-up policy of 10 lacs.
The deductible amount will be 5 lacs
Sum Insured – 10 lacs
Actual coverage in your top-up policy – 5 lacs (10 lacs- 5 lacs base policy)
Now Important T&C in Top-up policy is you have to pay deductible amount during each claim separately to get triggered Top-up policy.
E.g. You have taken 5 lac base + 10 lac Top-up policy (Here Actual coverage in top-up is 5 lac)
Case 1: You get an accident & your bill goes to 7 lac. Here, in single admission you have used deductible amount (Of 5 lacs), your top-up policy will get triggered & the remaining 2 lacs will get paid from the top-up plan.
Case 2: You get dengue & bill of 4 lac has been settled from base policy. Now you have 1 lac remaining in base policy + 5 lac top-up. After a few months, you get an accident & the bill becomes 3 lac. In this case, your top-up policy will not get triggered. Because as per the T&C bill should be more than deductible amount (here 5 Lac) in single admission to get triggered top-up policy.
The difference between Top-up & super top-up policy is that in the super top-up policy they calculate deductible amount cumulatively. So, in the above case 2, the super top-up policy will pay the remaining 2 lacs but not top-up policy.
The super-top up policy is somewhat costly compare to top-up. But always buy Super-top & not Top-up policy.
After doing extensive research (I am yet to read policy wording of few more Insurer), My preferences will be
Apollo Munich/ Hdfc > Max = Star = Icici = Bajaj > Other private player > PSU
Most important factors (Including detail T&C) I look for to choose the above preferences
• NCB, Restoration, Co-pay, Stay healthy benefit, Network hospital list, availability of insurer office in the city, most Imp – Customer reviews based on their past claim & experience with a different insurer, Pricing)
Many don’t agree with PSU at last, but I can give justification
• Difference of Premium of PSU & private insurer is not vast as it was previously (PSU are around 2-3k cheaper). Also Incurred Claim ratio of all PSU is above 100%, which will ultimately force them to increase premium like what they did 2 years ago. (Previously Bank linked group policy were issued by PSU were at 1/3 cost compare to private players but they increased premium by more than 100-200% because of unviable premium)
• There is no NCB in PSU which is very important
• Involvement of TPA. You don’t choose TPA, PSU will choose. Some of TPA is very well-known Notorious. They can make your life hell during & after a claim. )
I have tried to summarise all the important points. Still, if you have any queries, let me know. I will try to answer in my free time.
If any User wants to get an extra discount on a new purchase of health insurance, pm me. I might help you.
19) Top-up / Super Top-up Plan
Rather than going for a higher Sum insured in the base policy, one should go with the super top-up policy if a person feels that Base policy is inadequate. Because these policies are cheap.Again all hidden T&C are there in these plans. So read carefully before buying it.
Top-up policy – As the name suggests, it is top-up to your existing policy. Let us understand the terminology first. Deductible Amount – It is the minimum amount one has to pay (Either through base policy or through their own) to get triggered top-up policy.
Sum Insured – In top-up policy sum insured includes base sum insured also.
E.g. Your base policy is 5 lac. You have taken a top-up policy of 10 lacs.
The deductible amount will be 5 lacs
Sum Insured – 10 lacs
Actual coverage in your top-up policy – 5 lacs (10 lacs- 5 lacs base policy)
Now Important T&C in Top-up policy is you have to pay deductible amount during each claim separately to get triggered Top-up policy.
E.g. You have taken 5 lac base + 10 lac Top-up policy (Here Actual coverage in top-up is 5 lac)
Case 1: You get an accident & your bill goes to 7 lac. Here, in single admission you have used deductible amount (Of 5 lacs), your top-up policy will get triggered & the remaining 2 lacs will get paid from the top-up plan.
Case 2: You get dengue & bill of 4 lac has been settled from base policy. Now you have 1 lac remaining in base policy + 5 lac top-up. After a few months, you get an accident & the bill becomes 3 lac. In this case, your top-up policy will not get triggered. Because as per the T&C bill should be more than deductible amount (here 5 Lac) in single admission to get triggered top-up policy.
The difference between Top-up & super top-up policy is that in the super top-up policy they calculate deductible amount cumulatively. So, in the above case 2, the super top-up policy will pay the remaining 2 lacs but not top-up policy.
The super-top up policy is somewhat costly compare to top-up. But always buy Super-top & not Top-up policy.
After doing extensive research (I am yet to read policy wording of few more Insurer), My preferences will be
Apollo Munich/ Hdfc > Max = Star = Icici = Bajaj > Other private player > PSU
Most important factors (Including detail T&C) I look for to choose the above preferences
• NCB, Restoration, Co-pay, Stay healthy benefit, Network hospital list, availability of insurer office in the city, most Imp – Customer reviews based on their past claim & experience with a different insurer, Pricing)
Many don’t agree with PSU at last, but I can give justification
• Difference of Premium of PSU & private insurer is not vast as it was previously (PSU are around 2-3k cheaper). Also Incurred Claim ratio of all PSU is above 100%, which will ultimately force them to increase premium like what they did 2 years ago. (Previously Bank linked group policy were issued by PSU were at 1/3 cost compare to private players but they increased premium by more than 100-200% because of unviable premium)
• There is no NCB in PSU which is very important
• Involvement of TPA. You don’t choose TPA, PSU will choose. Some of TPA is very well-known Notorious. They can make your life hell during & after a claim. )
I have tried to summarise all the important points. Still, if you have any queries, let me know. I will try to answer in my free time.
If any User wants to get an extra discount on a new purchase of health insurance, pm me. I might help you.
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