Surprising Things You Didn't Know About Your Health Insurance Plan

Every responsible person with obligations towards the family has either already bought health insurance or is about to buy a plan. It is an important purchase in view of the current pandemic and rising incidence of critical illnesses and lifestyle diseases.

Are you aware of all the important aspects about health insurance in India? Getting as much information as possible helps you make an informed decision when buying insurance. The following are some surprising facts that you may not be aware of, and it helps to be appraised of them before buying health insurance plans:

• There’s an incentive for not filing a claim against your plan.

Most people have heard of it, but don’t know what it actually means – there’s a term called ‘No Claim Bonus’ (NCB) that health and vehicle insurance policies in India have. The NCB is a bonus that the insurance provider pays you when you do not file a claim against the policy in a year or more. This is an incentive that is added cumulatively for every year of not filing a claim against the policy. It is like a reward for the insured individual(s) to remain healthy and not file claims and for their loyalty by staying with the insurance provider and not porting to another one. You might wonder how the accumulated bonuses are paid to you – most insurance providers offer them as a discount on a forthcoming premium. Others might increase the sum assured on the plan.

The NCB is applied to both individual and family health plans. It is a good incentive for the insured individual(s) to maintain their fit and healthy status so as to avail of the bonus.

• You don’t need 24-hour hospitalisation to claim health insurance.

This is a common misconception, where people believe that they must necessarily be admitted to hospital for at least 24 hours, to be able to file a health insurance claim. While this was certainly true a few years ago, the Indian health insurance sector has undergone amazing transformation in the last decade. Today, based on the policy you purchase, hospitalisation is not mandatory to claim health insurance. Indeed, several comprehensive health insurance plans in India cover day care procedures. These include dialysis, radiotherapy and chemotherapy, among others, where hospitalisation is not required. Critical illness policies offer coverage in the form of a lump sum pay-out against diagnosis of illnesses like cancer, end stage renal failure, heart disease, etc. It is best to check the list of procedures covered and whether the policy mandates 24-hour hospitalisation for filing a health insurance claim.

• You will not always get 100% reimbursement for hospitalisation and treatment.

First time health insurance purchasers mistakenly believe that the policy offers 100% coverage against all future hospitalisation and treatment. In reality, the reimbursement percentage varies from policy to policy. Most health insurance plans in India have an upper limit or cap on room rent charges. Others impose sub-limits on medicine and doctor visit expenses, and offer only partial reimbursement against the same. When choosing the health policy, always study the policy document carefully to know the co-payment and sub-limit clauses.

• Buying the policy online makes it more affordable and easier to manage.

The days when one would hire an insurance broker to process their policy paperwork are long gone. Today, we live in a digital world and like other sectors of business, the healthcare and insurance sector has also moved online. You can easily buy the policy online and renew it annually using your laptop or smartphone. One fact about online policy purchase that most people are unaware about, is that it makes the premium on the policy more affordable. There are two reasons for this: One, the operational costs of processing an online application are much less, and these savings are passed on to the customer. Two, the insurance provider saves paying commission to brokers, and these savings are also passed on to the customer. Apart from these benefits, online management of the plan is much simpler rather than maintaining policy document copies, renewal forms and receipts.