By Sunil Dhawan
Even before one starts investing for long-term goals, it is important to get health insurance cover for oneself and family members. A hospital exigency may result in breaking (through surrendering or exiting) one’s existing investments to meet the expenses. This can be avoided if there is a health insurance cover.
At the same time, there are certain myths around health insurance which might deter one from taking an informed decision. Here are some common myths busted:
1. I am young and healthy. I don’t need health insurance.
In fact, the right time to buy a health insurance cover is when you are in the pink of health and leading a fit life. At times, certain ailments remain unknown to us until their symptoms are visible. As per regulations, such pre-existing ailments are covered after at least 48 months of holding a health policy. Therefore, buying early, before one develops any diseases, would help ensure that one’s health is insured without any such exclusions.
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By and large, a health insurance policy bought at an early age and renewed regularly for several years without any claim should lead to a better claim experience as and when it arises.
Further, health insurance is not just about illnesses and diseases. It is a universal truth that accidents may happen any time and at any age. A health cover would come in handy in case of such an event.
2. The cheapest policy is the best policy
While buying a term life insurance plan which is low-cost and high-cover may be recommended in many cases, an attempt to find o the cheapest health plan may not be the right approach. It is improbable that one would find two plans with similar features to make a comparison based on premium. The low-cost plans may not include all features or may have restricted features.
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Most health insurance plans nowadays go above the basic version. While the basic version caters to the more essential aspects of hospitalization, enhanced versions (termed as premium, exclusive, elite etc) usually come with added benefits. So while comparing them, ensure that you are comparing similar versions. The premium should be the last factor to consider while choosing a plan.
3. I have a group insurance cover, so I don’t need a separate policy
If your employer provides an option for group health coverage, grab it even if you have to pay a portion of the premium. The coverage amount may be restrictive so check if it is sufficient. Also, remember, especially if you are in the private sector that this group cover will continue only as long as you are in the job. The period between switching jobs may leave you unprotected. Moreover, few insurers are calling off their contract with employers and thus leaving several employees stranded without any coverage at all. Therefore, having your own health insurance policy helps.
Related: Group health insurance vs Individual health insurance
4. All benefits are lost if I don’t renew on due date
It is important that you don’t break the continuity of the insurance contract and keep renewing the policy. This will ensure that there is no period in which there is no coverage. Even if a health insurance policy is not renewed on the due date, one may do so within 15 days of the policy expiry date. This allows the insured person to be treated as ‘continuously covered’ in terms of continuity benefits such as waiting periods and coverage of pre-existing diseases. However, remember claim for any treatment during this period will not be accepted till policy is renewed by paying the due premium. This means that even if the policy is renewed 10 days after the due date claim for any treatment taken during these 10 days will not be accepted even after renewal of the policy.
5. Benefits from health plan start flowing from day one
A common grouse among most policyholders is that insurers decline claims on flimsy grounds citing non-coverage of certain medical events. In reality, the claims may be declined because of non-coverage due to ‘waiting periods’, which are always disclosed in the policy document. Being aware of these may help in a better claim experience. Every health insurance policy will have a ‘waiting period’, before which the claim against specific ailments will not be paid.
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No diseases get covered during the first 30 days from the commencement of any policy. Only accidental hospitalization gets coverage from day one. Further, some diseases are covered only after the expiry of a specified period. There are 1-year, 2-year, 3-year and 4-year exclusions for certain diseases. Pre-existing illnesses are mostly covered after the expiry of four claim-free years.
6. I don’t need to track hospital bills because the entire cost will get reimbursed
Defined benefit health insurance such as Mediclaim policies are supposed to reimburse the actual expenses incurred during hospitalization. However, in practice, often partial claim is paid by the insurer. Knowing the reasons for this may help avoid out-of-pocket expenses.
One, the policy may have it own sub-limits. For example, room rent may be capped at 1 per cent of the sum insured. The amount in excess of that has to be paid by the insured. Similarly, a policy may have such sub-limits on various other expenses. Further, certain medical expenses like specific medicine bills might not get reimbursed if they fall under non-admissible list of expenses. This is also a part of the policy document that policyholders receive after buying a policy. Further, there could be several incidental and other out-of-pocket expenses that one might have to incur.
7. One needs 24 hours of hospitalization for claim
Normally, the most important requirement for a health insurance claim is the minimum hospitalization of 24 hours. However, with technological advancements, certain surgeries and procedures require less time. Therefore, many health insurance plans have started covering claims for day-care expenses such as dialysis, chemotherapy, eye surgery and lithotripsy, among others.
Related: How to meet out-of-pocket expenses with Daily Hospital Cash plans
Generally, up to 140 such surgeries are covered by most insurers, with or without any restrictions. Certain hospital procedures, such as dental care, neither fall under day-care nor do they require 24-hour hospitalization. They are referred to as out-patient procedures and few plans have started offering claim on out-patient expenses as well, but with restrictions.
8. Even if I don’t disclose, all pre-existing ailments are covered after 48 months.
All health insurance plans cover pre-existing ailments but after a period of 48 months. Some plans cover pre-existing ailments even after 36 months or less.
This coverage of pre-existing diseases is conditional upon the buyer honestly making all medical disclosures at the time of buying the policy. This means that in case a person actually suffers from a disease at the time of buying the policy but is unaware of the fact and therefore declares himself as medically fit, then the insurance company would honour the pre-existing disease related claim after 48 months.
However, in case the insurer suspects that the buyer was aware of the pre-existing disease at the time of buying the policy then the company may refuse to honour the claim. This is the reason why it is important to disclose any pre-existing ailment at the time of buying, for a smooth claims settlement process later on.
Source: Economic Times
A pre-existing medical condition should not be a deterrent for buying your family health insurance and securing their financial future. However, proper disclosure and some precautions ensure that in case if any unfortunate event, you have a smooth and hassle free experience.
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