Category: Health Insurance

Most of us purchase health insurance policies as a financial backup to afford medical treatments at any point in our life. Moreover, our sedentary and changing lifestyle has led to a rise in several diseases like diabetes, cancer, heart attack, etc which requires long-term treatment and hence a regular drain to our financial resources at a time when medical treatments are becoming more and more expensive due to medical inflation.

Health insurance not only protects your hard-earned savings by covering the expenses but also enables you to avail best medical treatment and care with peace of mind as we don’t have to worry about hefty hospital bills. But are you satisfied with the health insurance policy you are currently having? Sometimes a big no, when we find that the current insurer is charging more premium and providing less services than its competitor. So can we port our health insurance policy to that competitor without being in any disadvantage just like we port our mobile numbers?

Yes. The Insurance Regulatory and Development Authority (IRDA) provisions, introduced in 2011, allow you to port your individual/family floater health insurance policies, and you don’t have to lose the benefits you have accumulated like in past when such a move resulted in your losing benefits like the waiting period for covering “pre-existing diseases.”

The insurance regulator protects you by giving you the right to port your policy to any other insurer of your choice. It not only “allows for credit gained by the insured for pre-existing condition(s) in terms of waiting period” but also protects your credit when you move from one plan to another with the same insurer. Please keep in mind that the new insurer is not duty-bound to insure you, this totally depends on his underwriting criteria.

What can you port?

The IRDA provisions say you can port credits on time-bound exclusions and no-claim bonus. The new insurer is bound to give you the credit relating to the waiting period for pre-existing conditions that you have gained with the old insurer, if he accepts your proposal. Do keep in mind that the features of your existing policy are not portable.

You can port only to the extent of the sum insured (including no-claim bonus) with the previous insurer. He will have to insure you at least up to the sum insured under the old policy. For example, if you have medical insurance of ₹5 lakh, but while porting to a new insurer, you want to enhance the sum insured to ₹10 lakh, the porting benefits will apply for only ₹5 lakh plus bonuses, if any.

How to port the policy

Notifying the insurer. You will have to apply for portability at least 45 days before the expiry of the current policy (and not before 60 days).

Specify the insurer (company) to which you want to shift the policy.

Fill up the portability form with existing insurance details, including the name and age of the insured.

Fill up the proposal form with complete details for the new insurer.

Submit the essential documents.

The essential data will be furnished on the IRDAI web portal. The new insurer will have to inform you within 15 days so that if he rejects your proposal, you still have time to renew your existing policy (there is a 30 day grace period if porting is under process). If the new insurer fails to inform you within time, he will be bound to accept the application.

Source: LiveMint

Understanding the terms and conditions of a health insurance policy seems like rocket science to many out there. However, it is always wise to have a knowledge of all the jargons your agent uses at the time of discussing health insurance plans. Here is our list of commonly used health insurance terminology:

Certificate of Insurance

This is the description of all important factors of the health insurance plans like coverage, cash limit and including benefits.

Co-payment

It is the number of hospital expenses that the policyholders agree to pay above the reimbursement cost that an insurer pays. The option of co-payment comes an advantage of a lesser premium.

Cumulative Bonus

The increase in the amount of Capital Sum by a certain percentage for each claimless year is a cumulative bonus. It never exceeds more than 50% of the Capital Sum. They increase the coverage amount and offer better protection to the health insurance holder.

Deductible

It is the amount of money that the insured must pay every year before consuming the benefits of their respective health insurance policies.

Grace Period

It is the time policyholder get for premium payment to the insurance company even after the due date.

Free Look Period

It is like a window given to the policyholder to review the benefits of the policy. In case of dissatisfaction, the insured can cancel the policy to get money back. It generally lasts for 15 days from the purchase of the policy.

Long-Term Care Policies

They differ from traditional health insurance plans as they are designed to provide a long term cover for services and support to individuals above age 65 for activities like custody care, nursing care or home health care services. They reimburse the holders a daily amount for such services. They are more flexible with more options than other policy programs.

Long Term Disability Insurance

They are designed to protect the future of the holder in case he/she loses his ability to work due to physical disability. They replace the portion of the individual’s income.

Maternity expenses

With a certain waiting period, some health insurance plans provide coverage for maternity expenses. One can reduce the waiting period by paying more premium.

Portability

If the policyholders discontinue paying a premium when they switch to another insurer or a fresh plan with the same insurer after encountering an issue with the current policy, they may lose certain benefits of the policy. The portability protects the policyholders from this loss. This is the right rendered to the policyholder (including family cover) to transfer credit acquired from pre-existing terms and time-bound exclusions. It works only when the previous policy is preserved without break in the premium.

Reasonable Charges

These are the charges mentioned on the hospital bills. Generally, insurers prefer paying reasonable charges and not the additional expensive services the insured get from the hospital.

Sum Insured

It is an annual maximum amount that the insurance company pay in case of hospitalisation.

Source: Reliancegeneral

Yes. You should definitely buy a health insurance policy at a younger age. If you can afford it, you should buy health insurance as soon as you turn 18 years old. Take a look at some of the reasons why buying health insurance at a younger age is a great idea:

1. Lower Premiums– Your age is one of the most important factors that determine your health insurance premium. Insurance companies consider younger people healthier and so, are a lower liability for them. On the contrary, older people are more vulnerable to ailments and thus, are a greater liability to the insurance provider. As a result, the lower is your age, the lower will be your premium amount.

2. No Pre-policy Medical Check-up– If you apply for a health insurance policy at a younger age, you will not be required to undergo a medical check-up before buying the policy. This prevents the insurance company from discovering any disease/ medical condition that may increase your premium. But this option is mostly not available for people above 45 years of age and their premium amount is determined based on their medical check-up report.

3. Easier to Get Over Waiting Period– Every health insurance policy comes with an initial waiting period of 30 days. Younger people are less likely to raise a claim during this period as their probability of having any serious medical condition is very low. Therefore, they can wait out the initial waiting period with ease. The same cannot be said for elderly people as they may face a medical emergency within days of buying the policy but will be unable to raise a claim during the waiting period.

4. Earning Cumulative Bonus– Most health insurance plans provide a cumulative bonus for every claim-free year. This bonus can be used to enhance your sum insured amount for no additional cost. A younger person is more likely to be fit and may not need to raise a claim during the policy year. This way they can easily earn cumulative bonus over the years. But older people may need to raise a claim owing to their age-related medical conditions making it difficult for them to earn a cumulative bonus.

5. Financial Freedom– The basic purpose of health insurance is to pay your medical expenses. With a health policy, you end up saving a lot of money on medical expenditures, especially those arising due to a sedentary lifestyle. Otherwise, you would have to pay for these expenses from your own pocket. Thus, the sooner you buy the policy, the more financial freedom you can enjoy.

When Is The Right Time to Buy A Health Insurance Policy?

The right age to buy a health insurance policy is in your mid-twenties and early thirties. At this age, you will most likely be in your best health and will be free of any financial responsibilities of your family. Let’s take a look at the outcome of buying a health insurance policy at different ages below:

Buying Health Insurance in Your Twenties:

If you buy a health insurance policy in your mid-twenties, you will be able to pay its premium easily as you won’t have any financial pressure. Your premiums will be affordable, which will allow you to opt for the best coverage as per your insurance needs. You will be able to afford additional coverage such as maternity insurance and get over its waiting period in case you plan to start a family in the coming years. Moreover, you can get a lifetime renewal facility and earn a cumulative bonus with ease.

Buying Health Insurance in Your Thirties:

If you decide to buy a health insurance policy in your thirties, you are most likely to opt for a family health plan. You may be planning to settle down and start a family at this age if you haven’t already and would want coverage for your spouse & children as well. Further, you may want to buy additional covers for diseases, such as heart ailments, whose symptoms are known to start showing at this age. Thus, the likelihood of your health insurance premium increasing and raising a claim is greater in your thirties.

Buying Health Insurance in Your Forties And Fifties:

If you are thinking of buying a health insurance policy in your forties and fifties, you would need to opt for higher coverage. Your financial responsibilities will be the highest at this age and you may have developed certain ailments like diabetes, high blood pressure, cancer, etc. As a result, you may have to opt for wider coverage with critical illness and sum insured enhancement benefits. Your premium will no doubt be very high at this time. You may opt for a family floater coverage to reduce your premium to some extent but it will still be pretty high.

Buying Health Insurance after Turning 60 Years Of Age:

If you are buying a health insurance policy after turning 60 years old, you will have to pay a hefty premium amount. You are most likely to face severe health ailments during this age, which may need long-term treatment and hospitalization. A basic health policy will not be sufficient at this stage of life and you may require a senior citizen health insurance policy. They will come with a higher sum insured and provide coverage for AYUSH treatment, domiciliary hospitalization, organ donor expenses, etc.

In A Nutshell

The right time to buy a health insurance policy is as soon as possible. The sooner you buy, the better it is for your pockets. Make sure to compare different health insurance plans online on Policybazaar.com to choose the best policy within your budget.

Source: Policybazaar