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How to choose the right health insurance plan?

Jan 29, 2018 | 3 years ago | Read Time: 3 minutes | By iKnowledge Team

Worried about rising medical cost? Here is how health insurance can help pay the bills.

Millennial or not, many people do not know what to look for when they take out a health insurance policy. And, having the right health insurance plan will secure your finances in a crisis, such as hospitalisation, surgeries, terminal illnesses and more. That’s why, it is important to choose your health insurance plan after considering the below factors:

Here’s a list of what you should look out for when you choose a health insurance plan:

What type of health insurance policy is it?

There are two types of health insurance plans—indemnity plans and benefit plans. Indemnity plans cover hospitalization expenses up to a predefined limit, which is the sum assured. Benefit plans pay a fixed amount for a predefined healthcare event. These plans cover critical illnesses, specific diseases, and the hospital cash policy.

What type of health insurance plan is it?

You need to decide on the type of insurance plan based on your family structure and health status. If you have a young nuclear family, a family floater plan would cover your children, spouse, and you. But family floater plans won’t do if your family members are over the age of 50 or have health issues. In that case, it would make more sense to opt for individual health plans. If you have no dependants, an individual health plan would be more suitable. If you have a family floater plan and your dependent parents are over 60 years old, you can buy senior citizen health insurance plans for them.

What premiums do you have to pay?

It is not a good idea to buy an insurance plan only because it has the lowest premium. You should study the fine print. Plans with the lowest premiums could come with a co-pay clause. This means the insured person pays a certain amount, while the insurance company settles the rest.

What are the sublimits on the plan?

A sublimit is the limit on the upper range of a medical expense for a claim. You will have to bear any expenses beyond the sublimit. So, it is very important to check the sublimits on the health insurance plan.

What are the waiting periods?

The waiting period is the time when the insured person cannot claim certain benefits under a health insurance plan. There are three types of waiting periods:

  • Initial waiting period: This ranges from 30 to 90 days after the initial purchase of the policy.
  • Pre-existing conditions: The waiting period for pre-existing conditions ranges from two to four years, depending on the plan.
  • Maternity benefits: The waiting period for maternity benefits ranges from nine months to four years.

Is there a cover for specific or critical illnesses?

Critical illness insurance has become popular due to the growing incidence of lifestyle diseases. There are health insurance plans for critical illnesses or specific diseases.

Which hospitals does the insurance company’s network include?

Cashless facilities are available only in the insurance company’s network of hospitals. So, you should check the list for the network hospitals near you. They should also offer the best healthcare facilities.

Does the plan cover day-care procedures?

Some health insurance plans do not cover day-care expenses. As hospitalization is not always necessary, you might want a health insurance plan that covers these procedures.

Is there a no-claims bonus?

Go for health plans that offer a no-claims bonus. This will reduce your premium or increase the sum insured.

What is the insurance company’s claim-settlement ratio?

The insurance company should have a strong claim-settlement ratio. This ratio indicates the quality of the service provided by the insurance company.

Bottom line

It’s important to consider the reputation and credibility of your insurer when going for your policy, rather than choosing a low-cost one from a company whose track record sub-par. Remember, the policy you choose will protect your family from bearing any financial strain. So, instead of focusing on premium amount, you should look at a health plan holistically.


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