What is Health Insurance?
According to the World Health Organization (WHO), it is expected that chronic and infectious diseases will see a rise by 57%. We all have been witnessing the spread of chronic diseases such as coronavirus, which are expensive in treatment as well. Therefore, it is crucial to have some financial shield against unexpected medical emergencies.
This is where health insurance plays an important role.
A health insurance plan is a commitment undertaken by the insurance company such that if the insured person is hospitalised for any illness or disease or even injury, then all agreeable expenses would be paid by the insurer. To avail this benefit, the insured would have to pay a price at the beginning of the policy term, called “premium”.
For example, say you have a fixed deposit of INR 2 lakhs in savings and you get coronavirus and need to be hospitalised. You need to undergo treatments the total costs of which amount to INR 3.5 lakhs. Now consider the following scenarios –
|Without a Health Insurance Plan||With a Health Insurance Plan of INR 5 lakhs|
What is Covered?
As mentioned in the benefits that health insurance plans offer a wide scope of coverage, here’s a look into the standard coverage benefits which you can find under a standard health insurance plan –
|In-patient hospitalisation||The costs incurred on hospitalisation and treatments are covered if you are hospitalised for 24 hours or more|
|Pre-hospitalisation expenses||The costs incurred before being hospitalised are covered for up to a specific duration which is usually between 30 to 90 days|
|Post-hospitalisation expenses||The costs incurred after being discharged from the hospital are covered for up to a specific duration which is usually between 60 and 120 days. These costs are incurred for monitoring your recovery after treatments|
|Daycare treatments||Those which do not require hospitalisation for 24 hours due to advanced medical techniques. Such treatments are also covered under health insurance plans|
|Domiciliary hospitalisation||If you are hospitalised at your home its expenses would be covered if such hospitalisation is because of non-availability of hospital beds or because you cannot be shifted to the hospital|
|Organ donor expenses||In case you undergo an organ transplant surgery, this feature would cover the expenses incurred on harvesting an organ from a donor|
|Ambulance costs||For hiring an ambulance to transport you to the hospital is covered up to a specific limit|
|AYUSH treatments||Non-allopathic treatments like Ayurveda, Unani, Siddha and Homeopathy are also covered under many plans|
|Free health check-ups||Health insurance plans allow you the benefit of monitoring your health through free preventive health check-ups. This facility is allowed once in 1-4 policy years depending on the policy you choose|
|Sum insured restoration||If you use the sum insured on a previous claim, this feature restores the sum insured to its original amount so that you get complete coverage for subsequent claims which occur within the same policy year|
|Maternity benefit||Under this benefit the costs associated with pregnancy, childbirth and pre- and post-natal care are covered up to specified limits. Maternity cover is beneficial if you are planning a family|
|OPD expenses||OPD expenses are those which are incurred on an outpatient basis on doctor’s consultations, medicines, diagnostic tests, etc. Many health plans allow coverage for such expenses up to specified limits|
|No-claim bonus||No-claim bonus (NCB) is a reward for you if you don’t make a claim in a policy year. You are either allowed an increase in the sum insured free of cost or a premium discounts on renewal through no claim bonus|
What is Not Covered?
Though health insurance plans allow a comprehensive scope of coverage, there are some medical costs and treatments which are not covered. These are called policy exclusions and some of the most common exclusions include the following –
|Pre-Existing Illnesses||Which already exist at the time of buying the plan. Usually, it is either not covered or not covered at least in the initial 2-4 years (waiting period)|
|Specific Illnesses||Like hernia, joint replacement surgeries, fistula, cataract, etc. are not covered within the first one or two years of the policy|
|Illnesses contracted right after buying the policy||Illnesses suffered within the first 30 to 90 days of buying the policy are usually not covered, other than accidental injuries, which is covered from the first day itself|
|Cosmetic Treatment||Which are not medically necessary would not be covered|
|Dental Treatment||Other than resulting from an accident|
|STD||Venereal diseases and sexually transmitted diseases like HIV or AIDS are not covered under health insurance plans|
|War and allied perils||Injuries or illnesses suffered due to war, mutiny, civil unrest and other similar reasons, including nuclear contamination, would not be covered|
|Overuse of drugs/alcohol||Health complications due to overuse of intoxicating substances would not be covered|
|Experimental Treatment||An unproven and experimental treatment is usually not covered|
You should know these policy exclusions to know the instances when your claims would not be paid by the insurer.