Health Insurance On EMIs The Policybazaar Show Amit Chhabra

The pandemic has rung alarming bells for the need for a comprehensive and trustworthy health insurance plan. Over six million people have bought health policies from April to August 2020. Keeping in mind the prevailing conditions due to the outbreak of Covid-19 and the need for easing of payment for health insurance premiums, The Insurance Regulatory and Development Authority of India had issued a circular allowing the payment of health insurance premiums in installments in April. This option is available on Policybazaar’s platform across all the insurers for the ease of the customers.

EMI option to bring relief for customers
The pandemic has raised the health awareness quotient in India. Covid-19 can happen to anybody whether young or old and can drain your finances. The hospital bills are as high as Rs 15-20 lacs. So, there is a definite need for health insurance and more people are buying it.

The lockdown has resulted in tough times financially for people. Many have lost jobs and businesses are also struggling. Affordability is a primary challenge among consumers. In these times, when people don’t have spare money to buy an adequate health cover of Rs 10,000-20,000, the Equated Monthly Installment (EMI) option comes as a relief.

Customers can pay EMI either monthly, quarterly, or half-yearly. The EMI option was introduced in life insurance 4-5 years ago and currently, 80-90% premium payment is happening through this option. With the EMI option introduced in health insurance as well, it is going to be a game-changer for the industry.

How it works
When you're buying your health insurance policy, a standing instruction or an e- mandate will be put on your payment instrument. Now, this could be a credit card or debit card, or a net banking account that you have. We will put an e- mandate or a standing instruction on your card, which basically means that every month on the date of renewal, automatically the money would be deducted from your account. So there is no manual effort needed every month. Every month you will get an SMS from your bank saying that a particular amount has been deducted from your credit card or debit card. So, it's a fairly seamless process. Let’s say you don’t have enough balance in your account and you miss the installment. There is always a grace period for your health insurance policy. You will get 7 days after the policy expiry to pay your installment.

Availing EMI on Policybazaar
A common perception of people for EMIs is that they are difficult to get as they require a lot of documents, long process, verification, some credit cheque, etc. That’s true in the case of buying a house or a car on EMI. The good news is that health insurance doesn’t require any of these. All you need to do is log on to Policybazaar and follow some simple steps.

Step 1: Select the health insurance option on the portal. Provide some basic details about yourself, which includes your name, gender, and mobile number.

Step 2: Provide the details of whom you want to insure and their age. Select the city where you reside. Provide the details of daily medication (if any)

Step 3: The quotes page will open and you can see all the health insurance plans available. There are about 25 companies from which you can choose based on your needs and affordability.

Step 4: Once you decide the health insurance plan you want to buy, you need to choose the sum assured and tenure of the policy.

Step 5: Fill up the proposal form giving details about your e-mail address, date of birth, height, weight, and occupation, etc.

Step 6: Click on Check out option. Once you do that, the option for payment of premium annually or monthly appears. Let’s say, if you want to pay annually, a Rs 1 crore health insurance policy for a 32 years old male living in Delhi costs Rs 10,396. If it's a large amount for you, you can choose the monthly payment option which will cost Rs 914 per month for 12 months.

Step 7: Suppose you choose the monthly payment option, options to pay through debit card, credit card, or net banking appear on the screen. Once you enter your card details/banking details, Rs 914 per will be deducted. These will be deducted every month automatically and you don’t have to worry about anything.

So, buying health insurance through EMI is an automated process. It's paperless and will transform the way health insurance is bought in India. Through this option, affordability will increase and more and more people will protect themselves financially against medical emergencies.

No change in claim adjudication
In case someone has paid just two monthly installments of the health insurance premium and files for a claim in the next month, in such a scenario, there will be no change in the claim adjudication process. It will be the same as the annually paid policy. At the end of the claims adjudication, when the payout is being paid to the consumer, the outstanding EMIs will be deducted from the payable claim amount and the balance would be paid. As a result, the customer need not pay further EMIs for the policy until the next renewal.

Customers can now afford a comprehensive cover
A lot of people don’t buy adequate health insurance because they find a higher cover expensive. With the EMI option, customers will be able to increase their policy cover. Buying a higher assured and a comprehensive cover is a must in health insurance. Retail health insurance covers only 3% of the population in India. So, the EMI option will help in increasing health insurance penetration in India. The EMI option will be beneficial for all demographics.

No major impact on premium
There is no major change as such on premium under the EMI option. It depends from insurer to insurer. Some insurers are offering the same premium. For example, the annual premium is Rs 12,000 for health insurance. So they are offering an EMI option of Rs 1,000 per month. In some companies, there may be interest in EMI but it's only 10%. The benefit of paying a premium in monthly installments far outweighs this 10% cost incurred in some cases.