You must have heard the saying “Health is wealth”. The necessity for sufficient insurance, including life and health insurance, has been amplified by the COVID-19 pandemic. Additionally, the post-COVID problems may result in serious illnesses that demand prolonged hospitalization and rehabilitation, adding to the cost. People now are trying to be fit and healthy by regularly exercising and taking proper diet. As much these things help, the need for health insurance pops up.
People try to Google about health insurance and how to buy it. They often come across a similar but different word “Mediclaim”. Even professionals tend to use these words interchangeably. But have you ever wondered what is the difference between a Mediclaim and a health insurance. Do these two plans provide the same coverage? What distinctions exist between the two? Let's find out!
In simple words a health insurance policy provides coverage for medical and surgical treatment of illnesses. In accordance with the terms of your health insurance plan, the insurer will take care of paying your medical expenditures when you receive treatment for a condition, provided that:
The insurance plan covers the disease.
The medical treatment for which the claim has been made, are acceptable. Some policies don't allow for certain practices.
The hospital and treatment facility are approved by the insurance company.
The allegation is correctly presented with pertinent and comprehensive supporting evidence.
The hospital or service provider may then request payment from the insurance company directly, or you may receive a refund for any payments you have already paid. Health insurance coverage is offered annually and needs to be renewed yearly.
Now, a Mediclaim policy covers any planned operation during the policy period as well as hospitalization costs incurred as a result of an accident, an emergency surgery, or both. Therefore, it only pays for hospitalization expenses. Policies that cover medical expenses also provide cashless or reimbursement ways for resolving claims.
What does Mediclaim NOT cover?
Any additional expenditures associated with receiving medical care, such as those for diagnostic testing, rehabilitation, regular check-ups, etc., are not covered by Mediclaim coverage because it only covers inpatient costs.
What distinguishes Mediclaim from health insurance?
On the surface, Mediclaim and health insurance policies may appear to be comparable in that they both offer cash assistance for medical costs.
It only pays for hospitalization costs.
As well as covering treatment costs, this insurance policy also covers costs incurred before to and following hospitalization.
It does not provide supplemental coverage.
The scope of the policy's coverage is expanded by add-ons. Critical illness insurance, personal accident insurance, accidental disability, loss of income, and daily hospital cash are some significant add-ons.
A mediclaim policy's features cannot be changed; they are predetermined by the insurance company.
The policyholder has more freedom to select the necessary type of coverage. Policyholders can tailor the coverage under the policy to their needs because the premiums are based on the features selected.
A mediclaim policy's price remains constant over time.
A health insurance policy's cost can vary since policyholders may receive discounts for not filing any claims or for policies that last for a longer period of time, such two or three years.
The maximum coverage that is offered, which is 5 lakhs, is another set feature.
There is no upper limit to health insurance coverage, which is based on the policyholder's age, evaluation of their health, and ability to pay the set rate. It may even reach two crores.
You can purchase medical insurance coverage on someone else's behalf, such as an employer on behalf of its employees.
In addition to individual personal health insurance policies, parents may also be covered by health insurance.
According to the insurer, floater coverage under the mediclaim insurance may or may not be permitted.
In order to provide coverage at a lower cost, all insurers permit plans that cover oneself and one's family in a single policy.
Now that we have understood the difference between health insurance and Mediclaim. Let's dive into the world of health insurance and get the best out of it.
Types of Health Insurance:-
1. Individual Health Insurance
An Individual Health Insurance is a policy which you may buy to cover you, your spouse, children and parents separately. This kind of insurance policy covers your medical bills for things like surgery, lodging and board, daycare costs, and hospitalization due to illness or accident. There will be an Individual Sum Insured for each participant of the Individual Health Insurance plan. For instance, if you get a 5 lakh individual health insurance policy that covers you, your spouse, and your two children, each person covered will have a 5 lakh individual sum insured. Despite the fact that it raises the price significantly. People like you who are between the ages of 18 and 70 can choose to purchase this plan. The benefit of purchasing an Individual Policy is the fact that it provides a unique Sum Insured maximum for each covered person.
2. Family Floater Health Insurance
Family Floater Health Insurance is the best option if you want an affordable health insurance plan for your entire family. A single Sum Insured floats for each member covered by a Family Floater Health Insurance policy. The benefit of a Family Floater Health Insurance Plan is that the premium is significantly less than that of an Individual Health Insurance policy. You, your spouse, your kids, and your parents are all covered by this policy. You shouldn't consider bringing in family members who are older than 60. They are more likely to get sick, which will affect the premium. You should purchase a family floater policy if you or the oldest family member are under the age of 60. Th cons with this type of insurance is that the premium of the policy depends on the eldest member of the family and while buying separate policies of family members later (which is often required) , the medical history with insurance starts from scratch that poses risk with increased age. Hence, Few advisors prefer individual covers than family floater.
3. Senior Citizens Health Insurance
The Senior Citizen Health Insurance Plan is a type of health insurance specifically created for seniors over the age of 60. This coverage is a suitable option for you if your parents or grandparents are older than 60. A senior citizen policy will provide coverage for the cost of prescription drugs, hospitalization due to an accident or disease, as well as pre and post hospitalization and treatment. Along with these, other benefits including psychiatric benefits and domiciliary hospitalization are also provided.
Add-ons like "Zone Upgrade" assist in addressing the city-wide increase in treatment costs. As an alternative to this, you might decide to add alternative treatment (AYUSH) coverage.
Before selling a Senior Citizen Health Insurance Policy, certain insurers may demand a full physical examination. The lifetime renewability has increased the maximum admission age limit to 70 years of age. Additionally, since seniors are more likely to get sick, these plans are more expensive than other types of health insurance.
4. Group Health Insurance
A group is the target audience for a group health insurance policy. Therefore, if you run a start-up or corporate office, you should purchase these plans for your staff members. It is within the category of benefits provided to workers. You can purchase the cover as an employer to increase the rate of employee retention. The premium for the group health insurance plan is reasonably priced. Some insurance providers permit unlimited refills of the covered amount if it runs out. Your hospitalization due to an accident, illness, severe disease, psychiatric illness, or pregnancy is covered by a group health insurance plan. In addition to providing coverage for your employees, purchasing group health insurance will boost the reputation of your business. The employees are only insured while they are employed by your organization, which is a very important factor.
5. Top-up and Super Top-up Health Insurance
Have you ever noticed or paid attention to news stories regarding the growth in medical inflation? You may have read headlines about the rise in retail inflation virtually on a daily basis.
The price of receiving medical care has been rapidly rising. Your medical expenses might be high, whether you visit the doctor for a minor condition like a cold or fever or require hospitalization for a serious condition like cancer. For this reason, you should buy a good health insurance plan. However, given the sudden and serious nature of most medical emergencies, your health insurance coverage might not be adequate. A top-up health insurance plan can help in this situation.
In addition to your regular health insurance plan or a group Mediclaim policy, a top-up health insurance plan offers you medical insurance. As a result, having such a plan increases your level of financial protection against various health-related issues. A top-up health insurance plan functions very similarly to your standard health insurance plan, but with less expensive premiums, making it more cost-effective. A health insurance rider for a particular sickness, such as a critical illness rider or a personal accident rider, must not be confused with a top-up health insurance plan.
A top-up health insurance policy can be acquired separately from your primary health insurance plan, however a health insurance rider can only be obtained as an additional cover with your primary health insurance plan. A top-up plan can be used as both an individual Mediclaim health insurance plan and an additional layer of protection for your current health insurance plan.
Types of Top-Up:-
A top-up plan and a super top-up plan are the two types of health insurance top-up plans that are offered in India. The two types of health insurance policies and how they operate have been covered below.
1.Top-Up Health Insurance
A top-up health insurance plan gives you per-claim additional health insurance protection. You can only claim if amount exceeds the pre-decided deductible amount which can be self funded or through base health insurance policy.
Let's take the scenario where you have a base health insurance plan with a sum insured of 5 lakhs and a top-up health insurance plan with a sum insured of 7 lakhs as an example. You cannot file a claim under your top-up plan if you have already submitted a claim on your base health insurance plan for, let's say, 5 lakhs and then need to submit a claim for additional 3 lakhs because the second claim's amount is less than the base plan's sum insured.
The value of the claim must be greater than the total protected under the base plan, which in this case is 5 lakhs, in order for you to be allowed to submit a claim under your top-up health insurance plan. It's significant to know that a top-up plan only covers one claim over those filed under your primary health insurance policy.
2. Super-Top-Up Health Insurance
Using the concept of aggregate claims, a Super Top-up Health Insurance Plan enables you to submit several claims. In the aforementioned example, if you have a super top-up health insurance plan worth 7 lakhs in addition to a base plan worth 5 lakhs, and you use up the whole amount protected under the base plan in your first claim of 5 lakhs, you can file further claims against the super top-up plan.
After deducting your health insurance deductible, the first claim under your super top-up plan will be settled. If this claim costs, let's say, 5 lakhs, then the claim will be satisfied for 4 lakhs once the deductible of, let's say, 1 lakh has been taken into account. This super top-up plan allows you to make additional claims, but the total of those claims cannot be more than 3 lakhs because that is the amount of residual insurance coverage after your initial claim of 4 lakhs under this plan.
Aggregate deductibles are an option available under the Super Top Up Health Insurance Plan. Because of this, each health insurance claim does not have to exceed your deductible. Instead, this deductible should be exceeded by the total amount of all claims you make within a policy year. This gives you more freedom to use the benefits provided by your super top-up health insurance plan.
Other Special Health Insurance Types
Maternity Health Insurance
Along with the fundamental health insurance programme, a Maternity cover can be purchased as an add-on. The full cost of the prenatal, birth, and postnatal phases is covered. This coverage should be purchased by newlyweds or families expecting a child in the near future. It provides coverage for infertility costs, childbirth, and newborn care for the first 90 days. There is usually a two or three year waiting period for the Maternity Cover.
b. Diabetes Health Insurance
We are all aware that illnesses can strike suddenly. Therefore, regardless of your present health situation, it is advised to be prepared for such unforeseen medical crises with an Individual health insurance plan or Family health Insurance plan that includes diabetes protection. Otherwise, you might have to pay a hefty medical bill if you unluckily learn that you have diabetes. Maintaining a healthy lifestyle and paying attention to your nutrition are always thought of as good preventive strategies against diabetes, in addition to purchasing health insurance with diabetes coverage.
c. Cardiac Health Insurance
More than 50% of all heart attacks are reported in people under the age of 50, according to the Indian Heart Association. While 25% of heart attacks occur in people under the age of 40, this underscores the critical importance of cardiac health insurance programmes. The policyholder benefits from being able to keep up with the escalating expense of healthcare, which would otherwise deplete most of their funds.
Acute heart conditions such refractory heart failure, myocardial infarction or heart attack, cardiomyopathy, etc. are covered by cardiac health insurance plans. Additionally, heart patients must purchase health insurance in order to tackle these medical situations without experiencing any financial strain.
d. Cancer Health Insurance
In contrast to other diseases, cancer typically has multiple contributing factors. Numerous factors, including genetics, the environment, or unique constitutional traits of an individual, might contribute to cancer. Rarely are there any cancer prevention strategies available. Unfortunately, due to the high expense of treatment, if a person is diagnosed with cancer, they may have to spend all of their lifetime savings. It is crucial to always be financially prepared to get your treatment done on time because of the escalating expense of healthcare and the urgency of the procedure.
It is important to purchase cancer insurance even if you have basic health insurance. The costs and benefits necessary for cancer treatment may not be sufficiently covered by health insurance. Therefore, it is essential to purchase a thorough cancer insurance policy to manage difficult conditions with ease and protect your assets.
Lets get familiar with the terms:-
Purchasing insurance is a difficult task. It's considerably more difficult to read a policy document. Even if you make a concerted attempt to read this stuff from cover to cover, you'll most likely come up blank because you'll have no idea what half of the terms represent. So let's start with the most common aspect in the world of health insurance.
Ambulance Cover - Some health insurance policies cover the cost of an ambulance ride to the hospital for the policyholder. If your insurance policy does not cover additional costs associated with hospitalization, you may be out of pocket.
AYUSH - Nowadays, people are looking for alternative forms of therapy in addition to traditional treatment. Alternative treatments include Ayurveda, Homoeopathy, and a variety of other approaches. They are collectively known as AYUSH. Under the AYUSH add-on cover, some health insurance policies pay fees incurred due to hospitalization for seeking such therapy.
Beneficiary - In the event of the policyholder's death, the beneficiary is an individual or entity who has been identified in the policy as the insurance benefit recipient.
Claim Settlement - Claim settlement is the process of obtaining the claim money. Claim settlement is usually done in one of two ways by the insurance company. The first is the reimbursement process, in which you pay for the therapy and then file a claim for reimbursement later. The alternative option is a cashless claims process, in which your insurance company pays your medical expenditures directly to the network hospital.
Co-payment - A co-payment is a fraction of the claim amount that the policyholder must pay out of pocket while the insurance company covers the balance. As a result, the cost of treatment is split between the policyholder and the appropriate insurance company. This liability is listed as a percentage in plans with a co-payment clause. Before you choose co-payment insurance, make sure you understand the financial risk you'll face in the event of a medical emergency.
Complimentary Health Check-ups - As a benefit for renewing their health insurance plan, health insurance companies provide free annual check-ups to policyholders. Some plans may cover the expense of full-body examinations, while others may allow the insured to receive free medical tests.
Cumulative Bonus - Your health insurance plan's cumulative bonus grows over time if you haven't filed a claim. For example, if one claim-free year results in a 5% rise in the sum insured linked to the plan, and you have five consecutive claim-free years in a row, your accumulated bonus is 25%.
Daycare Procedures - A daycare procedure is a procedure that necessitates admission to a hospital or clinic. However, because the admission is for less than 24 hours, it is not covered by regular healthcare. Chemotherapy, dialysis, angiography, and other treatments are examples of day care procedures. Only health insurance plans that cover daycare treatments will compensate you for the costs of undergoing the procedure.
Daily Hospital Cash - Also known as Daily Hospital Cash Benefit, this is a type of insurance that pays a certain amount for each day the policyholder is in the hospital. The exact amount is determined when the policy is purchased. Daily cash is offered as a stand-alone policy or as an add-on to normal health insurance coverage.
Deductible - This is the set amount of medical expenses that a policyholder must pay each year in order to successfully make a claim with the insurance company. Keep in mind that the term "deductible" refers to a set sum rather than a proportion of total expenses. Let's say your annual deductible is Rs. 10,000. In this instance, you can only collect policy benefits after paying the deductible sum of Rs. 10,000 for medical care in any given year.
Domiciliary Hospitalization - A domiciliary treatment is any medical therapy that policyholders get at home under professional supervision. Because the sufferer is unable to leave the residence, they cannot be taken to the hospital.
Exclusions - The policy's exclusions list any disease, ailment, or medical treatment that your insurance plan does not cover. When choosing a health insurance policy, don't forget to look over the exclusions. This list varies a lot from one insurance company to the next.
Emergency Care - Emergency care encompasses any medical treatment that is required urgently due to unforeseen circumstances. In most cases, such situations entail significant and life-threatening injuries or illnesses, for which delayed care might lead to complications or even death.
Free Look Period - A free-look period is a set period of time during which a policyholder is free to look around for different insurance companies without incurring any penalties or additional charges. In most cases, the free look period lasts up to 10-15 days from the date of purchase of the health insurance plan.
No-Claim Bonus - A No-Claim Bonus is a benefit given to policyholders for each year in which they do not file a claim. Policyholders who take advantage of this benefit will be able to get a bigger sum insured for the same premium the following year.
Outpatient Department Treatment (OPD) - OPD treatment is when an insured person goes to a clinic or healthcare facility for diagnosis and treatment without having to go to the hospital.
Portability is a feature of health insurance policies that allows you to switch insurance providers. If you're dissatisfied with your existing insurer, make sure you apply for an insurance port after choosing a new one.
Pre-existing Disease - A pre-existing condition is any disease or health condition that the policyholder already has at the time of health insurance purchase.
Pre and post-hospitalization coverage - This is available if you require financial assistance before or after your hospital stay. In certain circumstances, people begin accruing large medical costs long before they are admitted to the hospital. Pre-hospitalization occurs when your insurance company reimburses you for medical expenses incurred up to 30 days prior to hospital admission. Post-hospitalization coverage, on the other hand, is when an insurance provider covers medical expenses for up to 60 days after a hospital discharge.
Restoration Benefit - The term "restoration benefit" refers to the process of increasing the amount insured. If your insurance policy contains a clause like this, your sum insured will be reinstated once it has been used up.
Room Rent - In hospitals and clinics, room rent refers to the cost of a room per day. The cost of a room varies depending on the treatment facility. Some hospitals may levy fees.
Renewal - Renewal is the procedure through which a policyholder can keep their existing health insurance policy from expiring and, as a result, keep the benefits that come with it. They merely need to pay the yearly premium again before the policy ends in order to continue receiving benefits.
Reimbursement - Without a thorough understanding of reimbursement, your health insurance vocabulary will be lacking. If you choose to receive treatment at a non-network hospital, you will be responsible for all medical costs. You can then make a claim with your insurance company to get reimbursed for the therapy.
Sum Insured - The highest financial coverage available under your health insurance policy in a given year is referred to as the sum insured. It indicates the true value of your insurance and is also known as amount assured. When purchasing an insurance, the policyholder has the option of selecting the quantity of coverage. The amount of the sum covered determines the premium to be paid for the policy.
Waiting Period - After purchasing a health insurance policy, policyholders must wait for a waiting period before filing a claim. The waiting period for pre-existing disorders is usually set at four years, while the waiting period for other conditions is usually less.