Health Insurance: Why going for a high-sum insurance medical policy may not be a bad option?

In August 2023, insurance coverage dealer agency PolicyBazaar got here up with a report displaying that the price of frequent illnesses that require hospitalisation has greater than doubled within the final 5 years. The identical report additionally says that medical insurance claims for infectious ailments and respiratory problems have been rising at a charge of 14 per cent yearly, which is twice as a lot as retail inflation.

That was an estimate for frequent ailments within the post-pandemic period.

For crucial ailments, the rise in therapy prices can pinch a affected person extra severely.

For people or a household with a fundamental medical insurance plan, the sum insurance coverage (SI) may be insufficient to cowl the bills of therapy.

It could possibly drive them to fall again on their private financial savings to foot medical payments, thus rising their monetary burden significantly.

For a middle-income particular person, such undesirable medical prices can put their monetary objectives on maintain.

In one other situation, if an individual has a household historical past the place recurring well being points are frequent, a fundamental well being cowl of Rs 10 lakh may additionally fall in need of masking medical bills.

In such a backdrop, the need of high-SI medical insurance coverage involves the fore.

Since a lot of the corporations promote their high-SI medical cowl plans as tremendous top-up plans as add-ons with their fundamental plans, one does not should pay a lot extra cash for having a well being cowl of Rs 25 lakh or Rs 1 crore.

E.g., if a 30-year-old particular person dwelling in Delhi goes for Star Well being’s Sensible Well being Professional Plan, the annual premium together with GST for SI of Rs 5 lakh is Rs 5,983. For a Rs 10 lakh SI, it’s Rs 7,374.

But when one goes for a Rs 25 lakh or Rs 1 crore plan, they should spend Rs 11,043 and Rs 15,515, respectively.

The premium for a Rs 1 crore cowl isn’t even thrice the premium of a Rs 5 lakh SI plan.

Siddharth Singhal, Enterprise Head, Well being Insurance coverage, Policybazaar, says, “For those who purchase a medical insurance coverage with a sum assured of Rs 5 lakh, it might not be sufficient to cowl most severe illnesses comparable to most cancers, power kidney ailments, and heart-related well being situations. More and more extra prospects are choosing Rs 1 crore medical insurance plans, that are often a mixture of base plus tremendous top-up plans from the identical insurer. It comes at solely 10–15% additional value, supplies 1 cr protection at reasonably priced charges and claims may be cashless.”

One other necessary issue {that a} high-SI plan may help you with is thrashing rising medical inflation.

Adarsh Agarwal, Chief Distribution Officer, Digit Common Insurance coverage, says a medical therapy costing Rs 2 lakh at this time will value Rs 7.41 lakh 10 years down the road.

“People ought to bear in mind the longer term worth of medical procedures and hospitalisation earlier than shopping for a medical insurance cowl. The medical inflation charge in India is pegged at round 14%, which is among the many highest in Asia. This basically implies that a medical process that prices Rs 2 lakh at the moment will value Rs 7.41 lakh 10 years from now.”

For a wholesome particular person of their 30s, a fundamental medical insurance plan may match, however having a high-SI cowl plan prematurely helps them full the ready interval for crucial diseases at fairly an early age.

Together with that, when you go with no declare for a yr, your medical insurance firm may additionally reward you by supplying you with a reduction on the premium.

Agarwal says, “One ought to get a medical insurance cowl as early in life as potential because the premium charges are the most cost effective for children, they usually can end any stipulated ready intervals for pre-existing ailments, particular diseases, and so on. when they’re in good well being.”

The advantage of taking a high-SI coverage early in life can are available outdated age, when one’s medical bills could multiply many instances.

Bhaskar Nerurkar, Head, Well being Administration Workforce, Bajaj Allianz Common Insurance coverage, says, “As people age, their healthcare wants have a tendency to extend, making a better sum insured prudent, particularly for senior residents. A further profit is that high-coverage insurance coverage additionally supplies you with a wider alternative of hospitals, docs, and healthcare services. For the reason that analysis of crucial diseases comparable to most cancers, kidney- or heart-related ailments, and drugs can also be costly, a high-SI plan may also assist cowl such bills.”

There was a time when medical insurance coverage corporations did not cowl a lot of the crucial diseases, however now a few of them are masking as many as 99 crucial ailments of their high-SI plans.

Shashi Kant Dahuja, Chief Underwriting Officer, Shriram Common Insurance coverage, says, “Excessive protection ensures which you could deal with vital medical bills with out depleting your financial savings. It covers a variety of medical companies, together with hospitalisation, surgical procedures, diagnostic exams, and drugs. Excessive protection insurance policies typically embrace safety in opposition to crucial diseases, offering substantial monetary help throughout such difficult instances.”

Normally, insurance coverage sums as excessive as Rs 1 crore are unused.

However in sure instances the place a number of hospitalisations are required for an individual with a crucial illness or when one has to go for high-cost robotic or bariatric surgical procedures, such plans could come useful.

Shashank Chaphekar, Chief Distribution Officer, ManipalCigna Well being Insurance coverage, says, “A medical insurance coverage with larger sum insured can maintain every little thing – from therapy of crucial diseases comparable to most cancers and heart-related illnesses to superior procedures comparable to robotic and bariatric surgical procedures.”

The opposite advantage of a high-SI coverage floater plan is that many members of the family may be coated underneath a plan, and everybody of them can have enough insurance coverage cowl to satisfy their medical wants.

Nerurkar says, “Within the case of a floater cowl, the restricted sum insured is out there for all of the members of the family and if there’s multiple medical episode throughout the yr, the quilt chosen will not be enough. Therefore, a better sum insured underneath the floater plan is all the time advisable.” 

Earlier than shopping for a medical insurance coverage coverage, one ought to contemplate components comparable to age, household medical historical past, kind of pre-existing ailments, having a high-SI coverage by giving an additional premium could save from undesirable medical bills that will value your funds dearly.