Personal Finance

Insurance Uncovered

Rajalakshmi Nirmal | Updated on March 03, 2019 Published on March 03, 2019

This is with reference to your advice to me published in BusinessLine, dated December 3, 2018. I surrendered my Health Plus Plan to LIC as you had suggested and received the accumulated amount.

My Apollo Munich plan - Health Wallet covers my family (of four) for ₹5 lakh. Kindly advise if I should take a critical illness policy or disease-specific plans.

Also, should I enhance the cover under the health wallet plan? Please guide me so that I am able to obtain a reasonably good cover for health-related matters for my family and me.

G Surendra

I am happy to know that you are evincing interest in a comprehensive health cover for the family. Many tend to ignore insurance in their busy day-to-day routine.

For a family of four, a health insurance policy with sum insured of ₹5 lakh looks sufficient.

But given your age, details of which you provided in the earlier mail (self 50 years, wife 43 years) and grown-up kids, you need a higher SI. But I would suggest you do this through a top-up policy rather than increasing the cover in the base policy. This would help you save on premium.

Take a top-up or a super top-up for another ₹2-3 lakh.

In a top-up cover, your hospitalisation expenses need to exceed the deductible limit every time. ‘Deductible’ is the portion of the hospital bill that you will have to fund from your pocket or from a medi-claim policy you own.

This example will make it clear: Now, you have a cover for ₹5 lakh through your base health plan. Say, suppose you take a top-up plan for ₹3 lakh with ₹5 lakh deductible. If you spend ₹3 lakh on hospitalisation during the year, the base policy will pay ₹3 lakh.

If you are hospitalised the second time in the year and the bill is ₹3 lakh, your base policy will pay ₹2 lakh; for the balance ₹1 lakh, you need to arrange funds.

The top-up plan cannot be used because you didn’t cross the minimum threshold of ₹5 lakh. But had you had a super top-up plan, it would have come handy.

Taking the same case, in your second claim, when the bill was ₹3 lakh, the base plan would have paid ₹2 lakh and the super top-up plan would have paid the balance ₹1 lakh, as you crossed the threshold of ₹5 lakh on the whole (in the two times of hospital admission, put together).

You should see if Apollo Munich itself offers a super top-up plan. When buying a super top-up plan from the same insurer, chances are high that you get continuity benefit on pre-existing diseases (PEDs). Otherwise, HDFC ERGO’s - my:health Medisure Super Top UP Insurance is a good option. The product is priced competitively compared to similar plans in the market.

For critical illness (CI) cover, you can buy the standard CI plans in the market or the disease-specific ones.

The standard defined benefit CI plans are cheaper. Future Generali Heart and Health Insurance plan (where 59 illnesses are covered) or Bajaj Allianz Life’s Health Care Goal, which covers 36 critical illnesses, are an option that you can consider.

If you are looking for a comprehensive cancer cover, HDFC Life Cancer Care is an option. ICICI Prudential Heart Protect can be a choice for heart cover.

Note that if you buy covers for heart ailments and cancer separately, the premium may go up and would be more or less equivalent to the premium you will pay for a standard CI plan.

One other option before you is to buy indemnity CI plans. These would pay only for the actual cost of hospitalisation up to the SI, unlike the defined benefit CI plans which pay the full SI on the occurrence of the stated illnesses.

These are a lot cheaper and since they are policies from health/general insurers, they provide a life-long renewable policy. Apollo Munich’s iCan and Religare Health’s Cancer Mediclaim are indemnity plans that cover cancer.

In fact, Religare Health Insurance has a Heart Mediclaim, Critical Mediclaim and Operation Mediclaim (that covers listed surgical procedures) covers which are in the nature of indemnity policies, which you check out.

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