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Safety Above All Health Insurance

Posted by - ICICI Lombard, GIC Ltd.
January 13 2015

Several years of financial planning and meticulous savings helped Rakesh Mishra to plan the purchase of his new car. However, destiny had something else in store for him. Rakesh was rushed to the hospital the night before complaining severe chest pain. Couple of days later, less than 10 minutes at the billing counter of the hospital and his savings had depleted by an enormous amount owing to the steep hospitalization expenses. While he had planned for his dream home, car and vacations, buying a health insurance plans never crossed his mind.

Just as with this case, rapidly increasing incidents of lifestyle diseases along with high medical costs has made people vulnerable to unexpected emergency expenditures. To reduce the risks associated with emergency hospitalization, health insurance is the answer.

Insurers today offer a wide range of health insurance covers. Given the criticality and diversity of ailments and hence covers, it becomes all the more important to understand what you are buying, especially on the first occasion.

The five tips below are thumb rules of health insurance purchase geared especially towards the first-time buyers:

1) How much Sum Insured? : You should take cognizance of what you are looking for, pinning it down will be better. It is prudent to take into account your family size, their current health conditions and future health needs before deciding on the Sum Insured amount for your health cover. You should also keep in mind the increasing incidences of chronic ailments, medical inflation pertaining to your city as well as the nature of hospitals you go to. The Sum Insured has to be adequate enough to take care of the unexpected medical expenditures of future. Knowing your needs thoroughly will help in selecting the right health cover amidst the plethora of products available in the market today.

2) How much can you afford to pay? : Before purchasing health insurance, ask the question, 'how much can you afford to pay out-of-pocket in a year?'. Insurance plans vary widely in terms of premiums, deductibles and coverage. While there are Mediclaim plans which take care of the complete medical expenditure except the exclusions, there are policies with cost sharing mechanisms as well. Such policies are available at a much lower premium and allow you to pay part of the expenses from your pocket. You can opt either for a co-payment policy where you pay a part of the expenditure or a deductible policy which takes care of your medical expense over and above the chosen deductible amount which you need to pay from your pocket.

3) Look at the coverage and not just the premium: You should decide on a health insurance policy post evaluating the coverage options offered by the same. Are you looking for OPD, Maternity, Value Added Services cover along with your regular Mediclaim policy? Today health insurance is there even for healthy customers and takes care of your regular check-up and wellness expenses along with providing various value Added Services. You should always avoid selecting a policy just by comparing the premiums. Instead, study the policy carefully. For the same premium and a given sum insured and age, policies differ in features offered. You must check for all the features offered and limitations cited in an insurance cover and choose the one that provides maximum benefit and is affordable. You should always read the policy document carefully while taking note of the terms and conditions, checking exclusions etc. It is advised that you always fill the details of pre-existing diseases and personal health information correctly to avoid any rejection or hassle at the time of claim settlement.

4) Service level Parameters: Insurance is about promise and it is important that the insurance company stays with you at the time of need. Therefore, it is important that you analyse and verify the services offered by the insurance provider. The percentage of claims settled, the time taken to settle claims, claim processing structure, cashless service, network of hospitals etc. should all be compared before selecting the health insurance provider. Such information can be either availed from the regulator's website or individual companies' website as public disclosures.

5) Stay alert and buy young: Similar to everything else in life, the younger one is, larger the spectrum of choice. The older one gets, choices tend to narrow. Once an ailment kicks into one's health, the choice can become minimal. Hence, it is advisable that you remain vigilant while young and buy the best possible health insurance cover at a young age and at a much affordable pricing.

These top five thumb rules of purchasing health insurance will make the choice of this essential cover an easy one. Hence, buy smart and early to have a hassle free medical care for you and your family for lifetime.


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