Top-up Health Insurance

What is Top-up Health Insurance?

A top-up health insurance plan is an indemnity policy that provides additional medical coverage to people with an existing health insurance policy or an employer mediclaim policy. It allows people to get their medical expenses covered even if they have exhausted the sum insured of their regular medical insurance policy. However, a top-up plan comes with a mandatory deductible or threshold limit and provides coverage only after the insured has paid the deductible amount.

Top-up medical insurance plans are affordable and more economical than basic health insurance. They can also be taken along with the health coverage provided by your employer. In simple words, top-up plans offer an additional sum insured to help you cope with unforeseen medical emergencies in case you feel your existing mediclaim policy may not suffice.

How Does Top-up Health Insurance Work?

A top-up health insurance plan gets activated only when the sum insured of your regular health policy gets exhausted. The plan comes with a deductible amount, which you (the policyholder) need to opt for at the time of buying the policy. Deductible in health insurance is the part of the medical expenses that you agree to pay before filing a claim. Only when you pay the deductible amount, you can claim your top-up insurance plan.

You can pay the deductible amount from your own pocket or through another health policy. However, deductibles apply to every hospitalization claim, and you need to cross your deductible limit in a single hospitalization bill to activate your policy. Moreover, you can claim your top-up insurance plan only once in a policy year.

For example, suppose you have a ₹5 lakh health insurance policy and decide to buy a top-up insurance plan of ₹10 lakh with a deductible of ₹3 lakh. Let's say you got hospitalized for an illness and incurred a single hospital bill of ₹7 lakh. In this case, your base policy of ₹5 lakh will be exhausted in paying the hospital bill. Hence, you can claim the remaining ₹2 lakh from your top-up plan as your base policy's sum insured will be considered your deductible amount.

However, if you have incurred two separate bills of ₹2.5 lakh each, then you cannot claim your top-up policy. This is because none of the bills will be sufficient to cross the deductible amount of ₹3 lakh.

List of Top-up Health Insurance Plans in India

Take a look at the top-up insurance plans available in India:

*Disclaimer: The list mentioned is according to the alphabetical order of the insurance companies. Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. For complete list of insurers in India, refer to the Insurance Regulatory and Development Authority of India website www.irdai.gov.in.

Benefits of Buying a Top-up Health Insurance Plan

Here are some of the reasons why you must buy a top-up health insurance plan:

• Get Enhanced Coverage – A top-up plan helps you to enhance your medical coverage so that you can pay for unforeseen medical expenses even after the sum insured of your base policy gets exhausted.
• Lower Premiums – Compared to regular health insurance plans, top-up insurance plans are available for lower premiums as the deductible amount lowers the liability of the insurer.
• No Restrictions or Sub-limits – Most top-up plans do not have any restrictions or sub-limits on hospitalization expenses, like room rent, doctor fees, etc.
• Easily Convertible – A top-up insurance plan is very flexible as you can easily convert it to a regular health plan at the time of renewal.
• No Pre-policy Screening Required – Most top-up plans do not need you to undergo any medical check-up before buying the policy. However, this exemption is available mainly up to a certain age and may not apply to senior citizen health insurance plans.
• Tax Benefits – Tax benefits can be claimed on the insurance premium paid to buy the top-up plan under Section 80D of the Income Tax Act.
• Peace of Mind – Even if your current health policy gets exhausted while filing a claim, you can still enjoy peace of mind as your top-up plan will cover your remaining bills.

What is Covered in a Top-up Health Insurance Plan?

The following medical expenses are covered under most top-up insurance plans:

• In-patient hospitalization expenses, including nursing and boarding charges, room rent, doctors' fees, OT charges, cost of oxygen, prosthetic devices or implantation of any other equipment during surgery, blood, diagnostic procedures, and other similar expenses
• Pre-hospitalization expenses
• Post-hospitalization expenses
• Day care procedures that do not require hospitalization of even 24 hours
• Organ donor expenses
• Emergency ambulance charges
• Domiciliary treatment expenses

How is Top-Up Insurance Different from a Basic Health Insurance Plan?

Check out the key differences between top-up insurance and a basic health insurance plan:

However, do not mix a top-up plan with health insurance riders. Riders, like personal accident cover, hospital cash allowance, critical illness cover, etc., offer coverage for a specific illness or situation. Moreover, you can purchase a rider only with a base health insurance plan. But you can buy a top-up plan irrespective of having a base plan.

How Top-up Insurance is Different from Super Top-up Insurance?

Top-up insurance and super top-up insurance plans are similar but not the same. Although they both offer additional medical coverage in case your base policy sum insured gets exhausted, super top-up insurance comes with additional benefits.

While top-up insurance allows you to file only one claim in a policy year after the deductible amount is paid, a super top-up insurance plan accepts multiple claims in a policy year. Moreover, you need to cross the deductible limit of your top-up insurance plan in a single hospitalization bill. However, the super top-up insurance plan allows you to club multiple hospitalization bills to cross the deductible limit.

For example, suppose your top-up insurance plan has a deductible/threshold limit of ₹3 lakh. Let's say you filed two claims in the policy year of ₹1 lakh and ₹2 lakh, or two members of a family health insurance plan are hospitalized, and the hospital bill comes out to be ₹2 lakh each. In these cases, your top-up policy will not be activated unlike a super top-up policy, which combines both hospitalization bills to cross the deductible amount.

However, if a hospital bill comes for ₹5 lakh, then the deductible limit will be crossed in a single hospitalization bill, and your top-up plan will be activated.

You Can Also Read: Difference Between Top-up and Super Top-up Health Plans

Can You Claim Your Base Health Insurance and Top-up Health Insurance Together?

If your basic health insurance plan reaches the sum insured limit, you can file a claim for both top-up and individual health plans together. Moreover, if you have purchased your base health policy and top-up policy from different insurers, then you can easily file a claim under both plans simultaneously. Both insurance providers will be liable to pay their part of the claim amount separately.

How to Select a Top-Up Health Insurance Plan?

Keep the following points in mind while selecting a top-up health insurance plan:

• Opt for higher deductibles if you are looking for an affordable plan.
• Choose a deductible amount that you can afford to pay through your base/employer mediclaim policy.
• Do not buy an expensive plan to cover certain exclusions, like daily cash allowance and dental cover, as they may be covered by your regular health insurance policy.
• Do not forget to check the waiting period for pre-existing health conditions, named illnesses, critical illness cover, etc., before choosing a policy.
• Do check if the plan also offers coverage to your family members, including your parents, spouse, and children.