by
iciclombard 01
| Nov 03, 2023
Updated on - 04 Feb 2026
Medical emergencies are unpredictable and often expensive. Even with a standard health insurance plan in place, a single major hospitalisation can exceed your policy’s limit, leaving you to cover the rest out-of-pocket.
Designed to provide additional financial protection, top-up plans offer extended coverage at a fraction of the cost of increasing your base policy. Whether you're planning ahead or simply want extra peace of mind, understanding how top-up insurance works can help you stay better prepared for life’s medical emergencies.
What are top-up health insurance plans?
Top-up health insurance serves as a crucial extension of your existing individual or employer health insurance coverage. It provides policyholders with additional financial protection to address situations where their primary health insurance coverage proves insufficient to cover hefty medical expenses. This insurance option acts as a safety net, ensuring you are not left financially vulnerable during unexpected medical emergencies.
In simpler terms, imagine your primary health insurance covers up to 6 lakh sum insured. However, in case of a serious illness or accident, your hospital bill comes to 10 lakh. In this case, the bill leaves you with 4 lakh out-of-pocket expenses. This is where a top-up health insurance plan comes into play, covering the remaining 4 lakh.
A top-up plan provides peace of mind by bridging the gap between your existing health insurance coverage and potentially high medical costs. It ensures you can access quality healthcare without worrying about the financial implications of extensive treatments or procedures. This added layer of security makes top-up health insurance an essential consideration for anyone seeking higher coverage against unforeseen medical expenses.
How does top up health insurance work?
If you are wondering: “how does top up health insurance work?”, let's take a look at a few scenarios. These will help you learn about the workings of this form of health insurance.
1. Coverage expansion
A basic health insurance policy purchased by you or provided by your employer may provide a lower coverage. A top-up policy can cover even up to 1 crore.
2. Lower premium
Suppose you have an existing 5 lakh policy with INR 5000 premium. To upgrade sum insured, option 1 is to purchase a new INR 5 lakh policy with a premium of INR 5,000. Option 2 is to get a top-up policy of INR 10 lakh with a much lower premium of INR 1000.
3. Top-up plan mechanics
In case of a claim of say 8 lakhs, the first 5 lakhs will be covered under your base policy and the remaining 3 lakh under your top-up policy. Every top-up policy will have a pre-decided, fixed amount that you must pay under your base policy, called the “deductible”. You can fix the deductible as per your existing coverage so that you don’t have to pay out of pocket at the time of a claim.
4. Financial prudence
The top-up plan offers comprehensive coverage without the need to buy another base policy or upgrade premiums. It ensures a financial safety net for significant medical emergencies.
By strategically combining your base health policy with a top-up plan, you aim to ensure comprehensive coverage while optimising costs and safeguarding your family's health and finances.
Benefits of top-up health insurance plans
Here are a few benefits of top-ups that make them a key element of a good medical insurance plan:
- Increased coverage at lower premiums: Get more sum insured for a fraction of the cost of upgrading your base policy.
- Affordable protection: Top-up plans only pay out once the deductible is crossed, which helps lower premiums.
- Comprehensive financial shield: Ideal when unexpected medical expenses push bills well beyond your initial coverage.
- Flexible deductible options: Choose a deductible you are comfortable with, balancing out-of-pocket costs with premium savings.
- Tax benefits: Premiums paid for top-up plans can qualify under Section 80D, similar to premiums for base medical insurance and critical illness insurance.
Things to know before getting a top-up plan
Keep these points in mind before choosing a top-up for your medical insurance:
- Understand the deductible: This is your out-of-pocket limit before the top-up benefits begin.
- Plan type matters: Choose between a basic top-up (per claim) and a super top-up (annual aggregate).
- Copayment clauses: Some policies require you to share costs even after the deductible is crossed.
- Waiting periods and exclusions: Pre-existing diseases and conditions related to critical illness insurance may have specific waiting periods or exclusions.
- Check coverage inclusions: Confirm that inpatient care, daycare procedures, ambulance and post-hospitalisation costs are part of the plan.
Conclusion
Top-up health insurance is a smart, affordable way to improve your medical insurance, whether you have a basic mediclaim or critical illness insurance plan. By understanding how top-up works, the deductible and the difference between standard and super top-up, you can choose a plan that supports your financial well-being in times of unpredictable health emergencies.
Disclaimer: The information provided in this blog is for educational and informational purposes only. It is not intended as a substitute for professional advice, diagnosis or treatment. Please consult a certified medical and/or nutrition professional for any questions. Relying on any information provided in this blog is solely at your own risk, and ICICI Lombard is not responsible for any effects or consequences resulting from the use of the information shared.