Health Insurance - Know the basics of your cover

Health Insurance - why should you buy

Our health is very uncertain and we never know when an illness or an accident strikes that makes the hospitalization unavoidable. In such scenario having a health insurance cover will save you from the major expenses such as room rent, consultant's or doctor's fee, expenses incurred for medical tests during hospitalization such as x-ray, blood, oxygen etc which may run in thousands and even lakhs of rupees. If there is no health insurance policy then you need to bear all the expenses and they cause a dent in your savings. Hence you should buy a proper health insurance policy for you and your family.

Health Insurance comes with lot of conditions and not easy for a new person planning to buy a health insurance to understand and if bought without proper understanding you may feel deceived by the insurer or by the person who sold you the policy.

Health insurance - Terminology you should know

Premium
Health insurance provides coverage for individuals or the family for an exchange of a price that is to be paid upfront to buy the policy. This is called premium. In case of banks that provide and EMI option to their customers holding a credit card, the bank pays the premium to the insurer upfront and collects the amount from the customer in the form of EMI.Generally the premium paid is valid for one year where as some of the insurers offer a two year policy with single premium payment.

The premium varies with the age group, sum assured and the number of family members covered under the policy. Higher the age group, sum assured and the number of family members higher is the premium. In a family floater the age of the eldest member is taken into consideration to calculate the premium. Hence if someone wants to cover his family and also the parents then it is better to cover the family (generally 2 adults and 2 kids) under the family floater and a separate policy for the parents as it will be cheaper option.

Sum Assured
Sum Assured is the maximum limit to which a claim can be paid for a person covered under health insurance.The sum assured may vary from 1 lakh to 5 lakhs in the form of individual or family floater depending on the requirement of the cover and premium paying capacity of the customer.

Family Floater
A family floater provides cover for the entire family under a single policy( 2 adults and 2 kids is considered as a family).Either one or all the family members can utilize the sum assured in case of hospitalization to the extent of sum assured.

Pre-existing disease
A disease is said to be pre existing if it exists before the health insurance policy is bought. pre existing conditions are not covered in the health insurance cover until the policy is maintained without break for 48 months or four years.

Pre- hospitalization expenses
Medical expenses that are related to a particular disease which is the cause for hospitalization are called pre hospitalization expenses. Insurers generally pay the pre hospitalization expenses upto an extent of 30 days and some of them up to 60days.One should remember here the fact that pre-hospitalization refers to a particular disease that caused hospitalization not every disease.

Post- hospitalization Expenses
Medical expenses incurred after the discharge from the hospital are called post hospitalization expenses. Insurers pay for the post hospitalization expenses till 60 days and some of them extend it to 90 days. Post-hospitalization expenses also refer to a particular disease due to which the insured was hospitalized.

Cashless Hospitalization
Cashless hospitalization is the real benefit of buying a health insurance. It means that the insured can get hospitalized if there is a need and can avail cashless treatment without spending from the pocket. Cashless treatment can be availed at any of the network hospitals that are tied up with the Third party administrator (TPA) which further has a tie up with the insurer. Cashless hospitalization can be availed with the prior approval of the TPA.

Third Party Administrator(TPA)
Third party administrator is a professional institution by itself with a network of hospitals across the country. It will have its own medical practitioners and doctors who work for the TPA and coordinate with the network hospitals in the event of claims, cashless treatments. They provide approvals upon the request of the claimant by analysing the costs and other aspects of the treatment. In case of cashless treatment TPA settles the claim directly to the network hospitals.

Exclusions - Health insurance
While buying a health insurance one has to read the exclusions section carefully to avoid problems when the actual event of hospitalization happens. It should not be a case where the claimant is unaware of the policy conditions, exclusions and the claim gets rejected as it falls in one of the clauses of exclusions.

Any disease that is contracted in the first 30 days of the policy period is excluded unless if it is an accidental injury. There are certain diseases which are excluded for the first two years of the policy. For example cataract, fistula, hydrocile etc.One should go through the particular insurer's policy wordings to check for the entire exclusions list before buying a health insurance policy.

Apart from the 1st year or 2nd year exclusions there are certain diseases which are covered after 48 months or 4 years, provided when there is no break in the policy in between. For example pre existing diseases are covered after 48 months with most of the insurers.

Permanent exclusions are also part of the health insurance policy. These are not covered at all. Example of the permanent exclusions are HIV or AIDS and related diseases, cosmetic surgery, mental disorder, intoxicant abuse like drugs, alcohol etc. some insurers cover ayurvedic, homeopathic treatments where as other insurers do not cover the same.

Health Insurance doesn't cover the regular medical checkups. To utilize the cover a minimum hospitalization of 24 hrs is mandatory except for the diseases like chemotherapy, dialysis, eye surgery, lithotripsy( kidney stone removal) etc which do not require 24 hrs hospitalization due to advanced technological day care procedures.

Health Insurance ensures peace of mind and minimizes the chances of financial burden by understanding and reading the policy wordings of the insurers before buying the health insurance policy. Health insurance can be claimed for tax benefits under the section 80D (subject to changing laws).

Health Insurance - Know the basics of your cover

Health Insurance - why should you buy

Health insurance - Terminology you should know

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