Health Insurance Checklist

Checklist Before Buying Health Insurance in India

Take a look at the health insurance checklist to consider before buying:

1. Individual or Family Plan

   Check if the health policy you plan to buy offers individual or family floater coverage. An individual policy will cover a single family member for an individual sum insured. On the other hand, a family floater health insurance policy will cover all family members on a floater sum insured basis.

   If you have a small family with young children, buying a family plan will be more economical. However, if you are an unmarried adult with elderly parents, opting for an individual policy will be a wiser option.

2. Adequate Sum Insured

   Check the sum insured of the mediclaim insurance policy you plan to buy. The sum insured is the maximum amount your insurer will pay at the time of claim. Therefore, it is essential to ensure that the sum insured of your policy is sufficient to cover all your medical expenses.

   Experts suggest buying a health insurance policy with a minimum sum insured of half of your annual income. However, do not opt for a very high sum insured, as it will invariably increase your premiums.

3. Scope of Coverage

   Check the extent of coverage offered by the policy you are inclined to buy for the premium charged. You should seek a comprehensive health insurance policy that provides coverage beyond regular hospitalization expenses. Ideally, your policy covers the cost of OPD treatments, day care treatments, pre and post-hospitalization expenses, AYUSH treatments, teleconsultations, etc. If you are planning to start a family soon, opt for a policy that offers maternity insurance coverage.

4. No Co-Payment Clause

   Check if your preferred policy comes with an in-built co-payment clause. For the unversed, co-payment is a fixed percentage of the claim amount that you must pay every time you raise a claim. Although plans with co-payments are more cost-effective, they limit your claim amount during medical emergencies. Therefore, it is better to opt for a plan with no co-payments so that you can claim your entire hospital bill.

5. Shorter PED Waiting Period

   Check the waiting period applicable to cover pre-existing diseases (PED), such as diabetes, high blood pressure, asthma, thyroid, high cholesterol, etc. Most health insurance plans cover pre-existing diseases after a waiting period of up to 3 years. This means your insurer will not accept any PED claims until you renew your policy three times. However, many new-age health plans now offer PED coverage from day 1 of the policy.

6. No Room Rent Limit

   Check if your preferred health policy has any restrictions on hospital room rent and room category. Unfortunately, most health insurance companies do not let you choose the room of your choice. Instead, they limit the maximum room rent or restrict the hospital room category for your stay. If you do not adhere to these room rent capping, you will have to pay extra for every service you avail during your hospitalization, leading to a substantial amount. Hence, go for a health plan with no room rent limit.

7. Opt for Wider Pre and Post-hospitalization Expenses Coverage

   Check the number of days up to which pre and post-hospitalization expenses will be covered by the plan you wish to buy. While pre-hospitalization expenses refer to medical costs incurred before getting hospitalized, post-hospitalization expenses refer to the healthcare costs incurred after being discharged from the hospital.

   However, the number of days to cover pre and post-hospitalization expenses may vary from plan to plan. Ideally, you must opt for a health policy that covers at least 30 days of pre-hospitalization expenses and 60 days of post-hospitalization costs.

8. No Disease-wise Sub-limits

   Check if there are any sub-limits on diseases or procedures under the plan you intend to buy. Sub-limits are the maximum amount up to which your insurer will cover the treatment cost of specific diseases/procedures. For instance, if your health policy has a sub-limit of ₹1 lakh on modern treatments, your insurer will not pay beyond this amount even though your sum insured is ₹10 lakh.

   A lot of times, insurers levy sub-limits on specific diseases, restricting the maximum amount you can claim. Thus, you must prefer to choose a mediclaim policy with no disease-wise sub-limits.

9. Restoration Benefit

   Check if the policy you are planning to buy has the restoration benefit. With restoration benefit, your coverage amount will be automatically restored by 100% before renewals if your original sum insured has partially or completely exhausted. This benefit is especially handy if you have a family health plan, as your coverage amount will be fully restored even after a family member utilizes the entire sum insured.

   While some plans may offer restoration benefits only once a year, others may offer it unlimited times a year. Moreover, it may or may not be available for claims arising out of related illnesses. Hence, you should opt for a health insurance plan that offers unlimited restoration benefits for related and unrelated illnesses.

10. Annual Health Check-ups

    Check if your preferred medical insurance policy offers the annual health check-up benefit. Several insurance companies pay for the cost of preventive health check-ups every year. It helps you keep track of your health condition and detect any disease at an early stage. Therefore, make sure to opt for a health policy that offers you the annual medical check-up benefit.

11. No Claim Bonus

    Check the No Claim Bonus (NCB) offered by the policy you intend to buy. NCB enhances your sum insured by a fixed percentage if no claims are raised in the previous policy year. It can also be accumulated for up to the maximum limit for consecutive claim-free years. For instance, if your policy offers a 20% no claim bonus for every claim-free year for up to 100%, then you can enhance your sum insured by 100% by not raising claims for five consecutive years. Therefore, opt for a plan that offers a high no claim bonus for every claim-free year.

12. Policy Exclusions

    Check the exclusions under your preferred health plan. Exclusions in health insurance are the diseases or medical expenses that are not covered by the insurance company. For instance, cosmetic surgeries, self-inflicted injuries, sexually transmitted diseases, external birth defects, treatments for alcohol or drug addiction, etc., are not covered by medical insurance plans in India.

    All mediclaim policies come with specific exclusions. Knowing what your policy does not cover eliminates any disappointments you may face during claims. Moreover, it will prevent rejections of your claims, as you will not file claims for diseases and procedures excluded from your policy. Hence, opt for a policy that comes with minimal exclusions.

13. Reputation of the Insurance Company

    Check the reputation of the insurance company before buying a health policy. You must check the Claim Settlement Ratio (CSR) and Incurred Claim Ratio (ICR) of your preferred insurer before finalizing a plan. While CSR helps you estimate the likelihood of your claims getting accepted by the insurer, ICR helps you evaluate the claims-paying ability of the insurer. You should also check reviews of the insurance company to get a realistic idea of the services they offer.

Checklist for Things to Do After Buying Health Insurance

Here is the checklist for things you must do after buying a health insurance policy:

• Check your policy document thoroughly to identify any errors, including mistakes in your age, spelling of your name, policy commencement date, etc.
• Make sure you receive your health ID card within a couple of weeks of buying the policy. If not received, follow up with the insurer rigorously.
• Go through the claim process carefully so that you can easily file a claim during emergency or planned hospitalizations.
• Inform your family members about your mediclaim policy, its coverage benefits and the claim process.
• Store the soft copy of your medical insurance policy on your phone/laptop and share a copy with all your family members.
• Claim tax deductions on premiums paid to buy your health policy under Section 80D of the Income Tax Act.
• Inform your insurance company about your spouse or newborn baby within the stipulated time if you wish to add them to your policy.
• Schedule a reminder of your policy renewal date so that you do not forget to renew your policy.

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