What is Health Insurance?
Health Insurance, popularly known as medical insurance or mediclaim is a form of insurance that provides you protection against expensive treatment costs. It protects you from paying the full costs of medical services when you’re injured or sick. Just like car insurance or home insurance, you choose a plan and agree to pay a certain rate, or premium, each month. In return, your health insurer agrees to pay a portion of your covered medical costs.
Health Insurance Policy ideally covers the following –
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What are the crucial factors to check before buying a Health Insurance Policy?
Cashless Network of Hospitals:
This refers to the list of hospitals tied up with the insurance company wherein you need not pay hospitalization expenses at the time of discharge from hospital. You should always check this list before choosing an insurer and should always prefer an insurer that has a tie-up with your preferred hospital.
Understand Exclusions in the policy:
Before you buy a health insurance, always read the exclusions of the policy i.e. features that are not covered under the policy. The exclusions vary as per the plan you choose. Always read these conditions before you pick any insurance plan to avoid chaos at the time of claim. Furthermore, you should make it a point to ask for sample policy wordings so as to get in depth knowledge about certain definitions, terms and conditions, exclusions and benefits being offered while comparing different insurance policies offered by other companies.
Scope of the insurance policy:
Always check the complete list of ailment/ disease covered under the policy. Insurance company can reject even your cashless claim if the disease for which the hospitalization is required, is not covered under the scope of the insurance policy.
Renewability refers to the maximum age till you can get your insurance policy renewed and can claim the features and benefits of that policy. You should always prefer taking a policy that has a lifelong renewability because old age is the time when you need your policy the most.
Waiting Period is also known as cooling period. It is a period during which the insurance company is not liable to pay any claims to the insured. When you sign up for a new health insurance policy, there is a wait time of 30-90 days (although the wait time is different for each insurer and each insurance plan). This means when you buy a health insurance plan, your policy does not get implemented with immediate effect. You have to wait till the cooling period to apply for any claims. So before you sign up for a medical/ health insurance plan, always remember to check to waiting period for your plan.
A pre-existing disease refers to any medical condition/ ailment/ disease of an individual prior to the commencement of the policy. Pre-existing diseases may not be covered in the first 2-4 years of the policy depending on your age and the nature of the policy.
Individual insurance policy Vs family floater policy:
You must also consider whether you want to buy individual policies for all family members or a family floater policy for all. In case of a young nuclear family, it is better to opt for a family floater policy that extents coverage to two adults and two children. Compared to individual plans, family floater plans come at a marginally incremental premium.
Apart from the above, there are some more features like insurance plans, coverage and claim process that are necessary to know before buying any insurance.
IRDA has issued the guidelines on Portability of health insurance according to which Portability has been made effective since Oct 1, 2011. Health Insurance portability means the insured has the freedom to switch from one insurer to another without losing any continuity benefit with respect to PEDs, waiting period and other time bound exclusions, earned in the previous health insurance policies, subject to continuous insurance in the previous years.