Insurance Uncovered

I had requested you to advise me about a health policy and you had suggested Apollo Munich's Optima Restore. In July, 2018, I had subscribed to Apollo Munich's Health Wallet and not the company’s Restore plan.

However, I had forgotten that I already had a health policy from LIC in 2009 — Health Plus plan. As I hadn’t seen the policy document for many years, I was under the impression that it was a life insurance policy.

Kindly guide me regarding continuation of LIC’s Health Plus plan. The next renewal is on February 4, 2019.

The annual premium is ₹28,500 and it covers my three family members and myself (myself: ₹5 lakh; my wife, daughter and son: ₹3 lakh each). The annual premium for Health Wallet is ₹28,386; it covers all my family members. Since I have taken Health Wallet, will it be useful to continue with LIC’s health policy? I am 50; my wife is 43, and my daughter and son 20 and 14 years respectively.

G Surendra

The Apollo Munich Health Wallet is a comprehensive health insurance policy. It is renewable life-long and has no sub-limits. It also comes with restore benefit — if the basic sum insured (SI) plus the sum from ‘multiplier’ benefit is exhausted, a SI equal to 100 per cent of the basic SI will be automatically made available to you. The ‘multiplier’ benefit under the plan is the no-claim bonus. If you don’t make claims on the policy, the company will give a bonus and enhance the policy’s SI by 50 per cent of the basic SI. So, the SI will double after two no-claim years.

All the above features are present in the Optima Restore plan too.

In the Apollo Munich Health Wallet plan, the additional feature is the OPD cover. But the additional premium for the OPD cover makes the plan really expensive and not worth the money. It is for this reason that the plan was not recommended to you.

However, since you have bought the plan, you can let it be.

Now, to your question on LIC’s Health Plus plan. This is a unit-linked health insurance plan. Your premium gets invested in the market to generate returns. It provides cover only till the age of 65 years, that’s another 15 years for you.

This plan from LIC is not a regular hospitalisation policy. It doesn’t cover you for medical expenses that you may incur. Further, the limits on SA for various surgeries make it a poor critical illness plan too.

The policy provides benefits only under three heads — hospital cash, major surgeries and domiciliary treatment. Under ‘hospital cash’ benefit, when you are hospitalised, a daily cash benefit to a maximum of ₹2,500 (this will be twice in the case of ICU admission) will be paid; maximum ₹1,500 in case of hospitalisation of spouse/children. In case of hospitalisation for any major surgery (as defined under the plan), a lump-sum benefit, as allowed under the plan, will be paid. In case of domiciliary treatment, an amount equivalent to the actual expense incurred can be withdrawn from the policy fund to a maximum of 50 per cent of the fund value.

It is suggested that you keep your health insurance separate from your investment.

LIC’s Health Plus plan allows surrender from the third year. Since you have taken the policy in 2009, you will be able to give up the policy.

But I suggest you can use a portion of the premium you save by surrendering the LIC plan to enhance the cover under the Health Wallet plan. Or, you can even look at taking a top-up health plan.

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