6 checkpoints before buying a mediclaim policy

If you haven't bought a health insurance or mediclaim yet, and are planning to buy one, do not forget to check these points before zeroing in on one. A mediclaim has many factors woven into it and it is important to know about these properly besides undertaking the arduous task of reading the fine print.

1. Individual and Family Floater

In individual policies each family member is insured for a specific amount whereas in family floater the whole family is insured for a particular amount. Before deciding on which one to opt for, there are certain points to consider.

In case of family floater, when the primary person insured or the eldest member of the family reaches a specific age, the policy is closed and even the members who are still younger cannot renew the same policy.

The same is applicable in case of death of primary insured. Here the maximum renewability age in case of family floater is also quite less. Also, after a certain age, children cannot be a part of the family floater policy.

The age generally varies from 21 to 25. After this age, children have to buy a separate policy for themselves. Both these conditions leave the family uninsured for any risk arising out of hospitalisation. And it is quite possible that getting insurance at that age is not possible anymore due to various health conditions.

In individual polices, the individual is insured and he is evaluated on individual parameters. The attainment of specific age or death will not impact the mediclaim policy of other family members and their renewability.

The author is CEO, Apnapaisa.com.

Apnapaisa is a price comparison engine that allows consumers in India the ability to compare the EMI, , interest rates and other fees for home loans , car loans , personal loans , business loans , credit cards , compare online quotes and features of life insurance , health insurance , car insurance , travel insurance and other general insurance policies in India.

2. Renewability age

The life expectancy of an average Indian is increasing due to better health facilities and improved living conditions. Health insurance is something which one needs at a later stage of life much more than when he or she is young.

Although the mediclaim policies are normally only for a period of one year, in actual practice it is a long term relationship with benefits accruing to you as the relationship with the insurance companies progresses. So your mediclaim policies should cover you as you age as it will be difficult to buy a policy from another provider at that age.

If your policies do not cover you at that point of time, then buying such a policy will not give you real peace of mind. Thus, one should always try to buy a policy that provides renewability till lifetime.

Currently only United India, Apollo Munich, Star Health and Max Bupa are offering this facility.

3. Sub-limit

This is one of the most significant clauses in health insurance policies. It might happen that you have taken the maximum sum assured, but at the time of claim you may end up getting only a part of your claim even though the particular treatment was completely covered by the policy.

These kinds of differences are usually related to sub-limits. Sub-limits are broadly categorised under two main sub categories:

The first set of sub-limits is on things like room rent, doctor's fees and medical OT charges.

Suppose your sum assured is Rs 5 lakh and they have a clause of sub-limit which says that they will pay a maximum of 1 per cent of sum assured per day for room rent implying that the insurance company will pay a maximum of Rs 5,000 per day for room rent and anything additional would be paid by the insured. These kinds of sub-limits are not there in all policies so you should prefer policies that do not have such sub-limits.

The second set of sub-limits is on diseases.

There are certain diseases that are covered within the policy but with a certain limit. For example a policy may say that it would cover cataract operation but with a limit of only Rs 15,000. This means that whatever cost you incur due to hospitalisation for cataract, the maximum you can claim is Rs. 15,000.

Most policies will have these sub-limits so understand what these are before taking up a particular policy.

This clause simply means that the bill amount has to be shared between the hospital and the insured in a pre-mentioned proportion.

Again this means that you will not get full value for your sum insured even though the total claim is within the sum insured.

For example if the company has a co-pay requirement of 20 per cent and you have a insurance policy for Rs 5 lakh and the hospital bill is for Rs 2 lakh the insurance company will give you only Rs 1.6 lakh and you will need to pay the balance Rs 0.4 lakh from your own pocket.

This clause is not there in every policy so such policies should be avoided, if possible.

Permanent exclusions are those set of conditions that are never covered by the health insurance policy. Most of these conditions are common across most of the policies. But at times some of them may carry some unusual permanent exclusion that is not similar to other policies.

These exclusions may become quite critical at times. So study the permanent exclusions given in the prospectus carefully.

Temporary exclusions mean certain conditions that are not covered for certain period. For example the policy may say that cataract or knee replacement surgery would be covered only after a period after 2 years.

Almost all policies have these temporary exclusions so you should be aware of what you are getting into.

6. Pre-existing disease

This is relevant only if you are suffering from any disease at the time of taking your first policy. Please note that pre-existing disease also means disease that arises from a pre-existing disease.

The most common example is if you have diabetes at the time of taking the policy and develop heart disease later, then even the heart disease will be treated as a pre-existing disease even though you had no heart disease at the time you took the first policy.

All the mediclaim policies have a clause that states that any disease that already existed at the time of buying the policy for the first time will be covered only after the policy has been renewed for a certain number of years. Along with that some companies also keep an additional clause that says that the aforementioned period should be claim free.

Another set of companies also put in a condition that during this cooling off period no care or treatment should have been taken for this pre-existing disease. This third condition is almost impossible to satisfy and hence it means that pre-existing disease will effectively not be covered.

Other things remaining equal you should prefer the policy that covers the pre-existing disease as quickly as possible.