Kartik Iyer, 24, an advertising professional was advised to buy a health insurance policy by his friend. Kartik did not take this advice seriously; he had a list of reasons for not buying health insurance policy.
He felt that he is young and healthy and therefore he will not contract any illness. Even if he is hospitalized, he thought that he could always handle the bills himself. He had the impression that claims in a health insurance policy are always rejected or you have to go from pillar to post to get them settled.
Sometime later he met with an accident and was hospitalized for 20 days. Kartik could not afford to pay his bills and his father had to pay the hospital charges for him. Even though Kartik is young and earning pretty well for his age, he had to depend on his father.
If only Kartik had taken a health insurance policy, his bills would have been taken care of by the health insurance company! And he would have remained trouble free, at least in the matter of finance.
Young people refrain from buying a health insurance policy as they feel it needs to be taken only when they grow older as they do not need insurance in their prime. They don’t understand that health insurance is a cover against uncertainties in life for which you might not be prepared. So like Kartik you may be young and healthy or feel that you can handle your hospital bills but no future is guaranteed. Today, the cost of medical treatment is on the rise and even a small accident or disease can suddenly wipe out your bank balance So, you need something that will provide security against expenses due to hospitalization costs. So it is smarter to bank on a health insurance policy that will take care of those expenditures.
The very concept of Health Insurance began as a result of the idea that even a lower economic strata individual can avail quality treatment as health comes first, by paying an affordable premium.
Today, what began as a simple idea has grown into a well established not to mention organized industry that strives to give you affordability of the kind of treatment that you need, without you having to worry about the cost. It is constructed with specific clauses and conditions so that the facility cannot be misused and the end user gets all the benefits he deserves.
In India it is also known as “Mediclaim” because the first health insurance policy which was launched in India was called Mediclaim.
Health Insurance gives you many benefits like providing you cover against hospitalization costs arising from treatment of disease or accidental injuries. So, it is necessary for every individual, of any age group, to get one’s self and family insured as it enables obtaining the best treatment without being bothered about the costs of the same.
How does it work?
When you buy a health Insurance policy you need to pay an annual fee to the company known as ‘premium’. The amount of coverage or ‘cover amount’ or ‘sum assured’ that you want will primarily decide the premium which you need to pay. Higher the coverage amount higher the premium. In the event of a claim, the maximum amount which the health insurance company pays you will be this coverage amount.
For example, you choose a coverage amount of Rs 4 lakhs for the year. Then throughout the year you can avail insurance coverage up to the amount of 4 lakhs, either in multiple claims or one whole claim should one hospitalization cost exceed 4 lakhs. Once you have reached the coverage limit you can no longer claim reimbursement for your hospitalization costs until your policy is renewed.
What is not covered?
Health insurance policy usually does not cover routine medical expenses; it is only a cover against hospitalization. Any health insurance policy has got a list of exclusions like pre- existing diseases, non- accidental dental care etc. The Health Insurance policy covers all or a part of the medical costs incurred in treating the disease or injury including the doctor’s consultation charges, medicine and nursing costs as per the terms and conditions of the policy.
How can you claim?
If, like Kartik, you also believe that claims in a health insurance policy are always rejected or that you have to go pillar to post to get it settled, you are mistaken. If you have all the proof and the right documents with you, your claim gets approved without any hassles.
Claims can be made in two ways:
Cashless settlement: If the treatment is sought in a network hospital of the insurance provider the insurance company pays the hospital directly through their Third Party Administrator. This type of settlement is called as “Cashless settlement”.Reimbursement: If the treatment is done at some other hospital, you can file a claim for reimbursement with the health insurance company’s Third Party Administrator after you have paid your bills. Then the TPA will pay you back the amount after examining your claim.
What are the types of Health Insurance policies?
The policies can either be an individual policy, a family policy or a group policy. The other variations are Critical Illness Policy, Senior Citizen policy, Student Medical insurance and Overseas Mediclaim Policy.
Individual Mediclaim Policy – Health insurance policy for an individual person providing that person cover for the expenses incurred due to treatment of disease or injury is called as Individual Mediclaim policy.Floater Policy- A floater health insurance policy covers your entire family under one policy with one sum insured and one premium. It covers all the expenses just as covered under individual mediclaim except that the cover is now extended to the family instead of one person. Under this, insurance will reimburse the cost of hospitalization of any family member covered, but the total reimbursement during the policy year is restricted to the sum insured. Critical Illness Policy – If you have a Critical Illness policy, the insurance company will pay you a lump sum amount if you are diagnosed with a critical illness as defined by the insurance company.Senior Citizen Policy – It is generally for people above the age of 60 and has a shorter waiting period. The entry age as well as renewable age (age up to which renewal is available)is higher.Overseas Mediclaim Policy - An Overseas Mediclaim Policy provides cover for medical expenses incurred abroad for treatment of illness and diseases contracted or injury sustained during the period of insured’s of overseas travel. Student Medical Insurance – The cost of health care while studying abroad is covered by Students Medical Insurance. It is an essential requirement with many foreign universities for their overseas students.
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