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Are you buying a health insurance? Must check these 5 points

April 04, 2018

With increasing health costs, the most effective way to secure your and your family is to buy a personal health insurance policy. While most salaried individuals may have a group insurance cover, it is always advisable to buy a personal cover which can be renewed every year. Also, under Section 80D of Income Tax Act, 1961, a taxpayer gets deduction of up to Rs 25,000 for heath insurance of self, spouse and dependent children.

At present, all health insurance policies provide for entry age of up to 65 years and do not have any exit age once the proposal is accepted, provided the policy is continuously renewed without any breaks. A policy can be either individual or floater, and one can increase the sum insured at the time of renewal.

Moreover, at some point of time if a single health cover plan is not enough to deal with the needs of an entire family as many insurers put a cap on the sum insured, one should look at a top-up plan as it gives additional cover over and above the normal coverage, and is helpful if the normal cover is exhausted.

Buying a health cover can be tricky as there are multiple products in the market. Therefore, one must look at the product information on the company’s website, which will include a description of the product, clauses, exclusions, network hospitals and premiums. Here are five things that one should look at before buying a health insurance policy.

Pre-insurance health check-up

Insurance companies insist on a health check-up if the applicant is above 45 years of age, or if the sum insured is of higher amount. The tests are conducted in hospital empaneled with the insurer and as per the regulator’s rule, the insurer will bear at least half the cost of the medical check-up.

Treatment-wise limit for claim

One must look at the treatment-wise limit for amounts one can claim under a health insurance policy. If the claim amount exceeds the amount set by the insurer, one has to pay the balance despite having a higher overall sum insured. Many insurers provide daily cash benefit for each day of hospitalisation.

One must also note the terms and conditions of pre- and post-hospitalisation offerings, no-claim bonus and waiting period for specified ailments, which vary from company to company.

Cumulative bonus and premium

While buying a health insurance policy, one must ensure that the cumulative bonus is stated explicitly in the prospectus and even in the policy document. Also, look at the product information on the company’s website, which will include a description of the product, clauses and premium rates inclusive and exclusive of the service tax payable. If the policyholder has made a claim in the policy year, the insurer cannot load any charges on an individual insurance policy at the time of renewal.

Pre-existing diseases

At the time of signing the insurance proposal, one has to disclose any pre-existing ailments and based on that the insurer decides whether to provide you insurance and the premium for it. Never hide or provide incomplete information in this disclosure as it may result in rejection of claims later. Many insurance companies do not give a cover if an individual has or even in the past had a pre-existing illness with major consequences. If they still do, the insurer will load the premium to cover additional costs that may arise due to one’s existing medical condition.

Waiting period and exclusions

Every insurer will have a waiting period for pre-existing diseases, which ranges from two to four years. Check the waiting period before you sign on the dotted line because if you have a pre-existing medical condition you cannot depend on health insurance policy in case there is any medical emergency due to the existing illness. It is always better to buy a health insurance policy at a young age when the chances of falling ill and pre-existing ailments are minimal. In individual health policies you can port your policy from one insurer to other, along with your waiting period already covered.

Source: Financial Express

Health insurance for all can be a reality

Mar 26, 2018

In Budget 2018, the government had made a few announcements. (a) On a National Health Protection Scheme (NHPS) providing insurance cover of Rs5 lakh per family; (b) Having an initiative to establish new government medical colleges and hospitals, and upgrading existing district hospitals under the programme; and (c) Setting up of over 1,50,000 health and wellness centres throughout the country.

In March, the Cabinet cleared the Ayushman Bharat National Health Protection Mission, dubbed Modicare.

An integrated approach in implementation of all the three initiatives can steer the country towards having universal healthcare. The success of the flagship NHPS, aimed at making available secondary and tertiary care to the needy could largely depend upon how successfully the other two initiatives are implemented.

The two major concern areas identifiable in the existing government health insurance schemes are enrolment and abuse or overtreatment or unnecessary hospitalizations. We have situations of fictitious enrolments, unnecessary hospitalizations or unnecessary hysterectomies, and other such instances.

Steps to implementation

Studies indicate that 65% of the healthcare expenditure in the country is for outpatient care, which are primarily out of pocket expenses. If comprehensive healthcare is the goal, effective financing and delivery of primary healthcare is vital. Setting up of 1,50,000 health and wellness centres is a big initiative and it has to be primarily implemented effectively. There is a strong case for public private partnership in establishing and running these health centres with specific measurable goals. Private participation could be further encouraged by means of tax benefits or subsidies.

Every NHPS beneficiary should mandatorily register with one of the wellness and health centres, which can function on capitation basis. To avoid unnecessary usage, a nominal co-payment can be collected from beneficiaries when such facilities are used. Medicines and diagnostics can be provided at subsidized prices or free to those who cannot afford it. These centres—manned by Primary Care Physicians (PCPs)—will provide outpatient care, including diagnostic facilities and medicines, and also act as gatekeepers for NHPS. Polyclinics with specialists and higher level of diagnostic facilities should also be established for referrals from the primary centres.

Every beneficiary of NHPS should consult a PCP in the health and wellness centre, and treatment in polyclinic by a specialist would be only on referral from the primary centre.

Existing as well as the new district hospitals should be equipped to be on par with corporate tertiary care hospitals. Existing as well as new medical college hospitals should be equipped to be on par with corporate super specialty hospitals.

Admissions of any NHPS member to a hospital should be only on referral from the PCP or the specialist, except in emergencies such as accidents. The PCPs and the specialists will act as gatekeepers for hospitalizations and would be responsible for preventing unnecessary hospitalizations and surgeries. Suitable mechanisms have to be built to prevent collusion of PCPs and specialists with hospitals.

Hospitals that are empaneled under the health protection scheme should be graded according to their infrastructure available and quality of care provided, and then continuously monitored also. The government must set up a National Health Regulatory Authority and insist on all state governments to set up similar authorities. All the heads of such regulatory authorities should become members of the National Health Regulatory Authority. This would bring in uniformity in the healthcare sector in the country.

An integrated approach to implementing all the three initiatives would have far-reaching effects on the country’s healthcare scenario, and we could see a healthier India. Rationalizing treatment or surgical procedures, and use of medicines and diagnostics will bring in reduction in healthcare costs. This would also lead to stabilizing the premiums of NHPS and ensuring continuous improvements in terms of coverage.

India has the problem of big numbers. Just launching NHPS without integrating the wellness centres as well as the government infrastructure may not yield the desired result in the long run. We must realize that implementation of such schemes requires strong planning, strong regulations, simple and efficient processes, and continuous monitoring through the use of advanced technological platforms. Implementation failures can not only result in an exponential rise in costs of such schemes, but also put a strain on future allocations as well towards the healthcare sector.


Insurance plan: How to know which type of scheme will suit you the best

Mar 26, 2018

For all its wonderful moments, life can be uncertain too. We all take preemptive measures to deal with any kind of uncertainties. Insurance is one such offering that provides a great financial cushion to safeguard oneself or dependent family members during tough times. The insurance market, currently, offers a wide variety to choose from. Life, Health, Travel, Automobile and Home Insurance being the notable ones. However, choosing the right insurance plan as per your needs also gets tougher with the multiplicity of choices. In this article, you will find an insight into the types of insurance you need.


Pay early, pay less should be your motto in your 20s. The sooner you buy Term Insurance in your career, the cheaper premium is. Term Insurance, which is cheaper than other life insurance products, provides an assured amount to the nominee if the insured person dies during the policy period. As most term insurance plans expire once the policyholder attains 60 years of age, opting early will ensure insurance cover for a longer duration at affordable premium rates.


Irrespective of what your age or financial earning is, a Health Insurance cover must be a part of your insurance portfolio. The rising healthcare and medical costs along with increased risk vulnerability owing to modern day lifestyle and stress mean that a health concern can deplete all your financial earnings in one go. Buying a Health Insurance plan early gives you ample time to stay financially protected from any pre-existing diseases after playing out the waiting period. A Health Insurance also offers tax benefits which can ensure optimum savings.


While Life and Health Insurance plans should be taken as early as possible for financial security, the type of insurance and cover should depend on your earnings, age, long-term financial goals and the number of dependants. Insurance premiums are cheaper at an early age than at a later age in life as the chances of age-related health issues are less. Prioritize essential insurance plans like Term Insurance and Health Insurance over an automobile insurance or a travel insurance plan, but do consider the latter if there is a need. Do not discount the riders of Life Insurance as an additional burden as they may offer enormous benefits. With an accidental death benefit rider, beneficiaries can get up to a maximum of twice the basic sum assured all for a nominal cost of the rider in the insurance plan.


When it comes to insurance life, health, travel and automobile insurance covers take centre stage, but there are various other insurance covers that can be equally effective for your needs. From insurance cover for misplaced keys for home or automobiles to cover for amateur sportsmen or even a second medical opinion, there are ample insurance plans that can be customized for your needs. It is best to do a little research about these general insurance plans before grabbing the best deal as per your risk and needs. For example, if you are an animal lover, you can opt for a pet insurance along with your Life Insurance plan.


When it comes to choosing insurance type, prioritise protection over the investment, returns or tax savings component. Term Insurance plans, for example, are not only more budget-friendly but also offer optimum protection compared to endowment cum investment plans. Opt for insurance as an investment only as an add-on once you have ample coverage and a protection plan in place as per your financial needs, your dependants and their future financial goals.

With so many insurance plans available, picking up the right plan can be a tough task. However, you should assess your needs, financial goals and protection requirement before opting for an insurance plan.


IRDAI extends deadline for linking Aadhaar with insurance policies

Mar 23, 2018

The Insurance Regulatory and Development Authority of India (IRDAI) has extended the deadline for linking of insurance policies with Aadhaarnumbers.

As per an an earlier order, all insurers should complete linking of insurance policies with Aadhaar before March 31, 2018.

The present direction has come in the wake of a recent decision of the Supreme Court to extend deadline till the final disposal of a writ petition filed challenging mandatory Aadhaar linkage.

In a circular to all life, general and standalone general insurers, the authority said: ``For existing insurance policies, the date of linking Aadhaar is extended till the matter is finally heard and judgement is pronounced by the Supreme Court of India.’’

For the new insurance policies, a customer is allowed six months from the date of commencement of account based relationship (or buying of policy) to submit Aadhaar number and PAN/Form 60 to the insurers, it said.

In the absence of Aadhaar, a customer can submit any of the officially allowed document as mentioned in the Prevention of Money-laundering (Maintenance of Records) Rules 2005.

Your Health Insurance May Become Costlier. Here’s Why

Mar 23, 2018

Health insurance could become costlier as insurers factor in the costs of covering genetic disorders.

The Insurance and Regulatory Authority of India on March 20 ordered insurers to not reject claims stemming from genetic disorders for all existing and new policies, according to a circular on its website. That followed last month’s Delhi High Court verdict that barred such exclusions to deny payments.

“When we go for the next price correction, certainly we will have to factor in the cost of that [genetic disorders] treatment also,” said G Srinivasan, chairman and managing director of New India Assurance Company, India’s largest general insurer. “The impact will have to be assessed for each of our policies; based on that we will get back to the regulator and request for price corrections.”

Insurers pay Rs 101 as claims for every Rs 100 earned in health premium, the highest among all businesses. They excluded genetic disorders from plans without specifying the diseases covered. Among the conditions for which claims were not paid included Down’s syndrome, thalassemia, haemophilia, muscular dystrophy, sickle cell anaemia and amino acid problems.There are 52 types of genetic diseases or syndromes, among which 51 are known to have an inheritance pattern, according to Indian Genetic Disease Database, a 2010 initiative of Council of Scientific & Industrial Research and Indian Institute of Chemical Biology. Insurers said it’s difficult to price in the risk for related ailments as they could crop up anytime in life. In comparison, implications of congenital defects are known since birth.

Now that insurers can no longer deny such claims, they will look to benchmark the possible costs.

For now, claims will have to be settled case-by-case, said Sanjay Datta, chief-underwriting and claims, at ICICI Lombard Insurance Company. Insurers will have to go by the experience of settlement and then approach the regulator with revised prices, he said.

Other general insurers like HDFC Ergo and Star Health Insurance agreed. “Genetic disorders need to be defined clearly for the sake of industry level uniformity,” an HDFC Ergo spokesperson said in an emailed response to BloombergQuint’s query. “Diseases such as diabetes, hypertension, cardiac conditions and many such others could also be hereditary and were never excluded.”

Another way out could be including genetic disorders as an add-on, which usually come with added costs.

As genetic disorders, similar to chronic diseases, are special risks, they cannot be included as part of the basic policy but can be added on to the cover as rider/s, if required, by the policyholder, a Star Health Insurance official told BloombergQuint requesting anonymity.

The exact impact on the pricing will have to be quantified by actuaries based on the incidences of genetic disorders in the past, said HDFC Ergo. “Additional disclosures will also be required from policyholders.”

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