How To Find The Best Health Insurance Plan?
‘Which is the best health insurance available today?’ 🤔
This is one of the most common questions we get asked on the Beshak Insurance Forum or Chat.
Before we go into answering this question, let’s digress a bit :) - Can you answer which is the best TV or laptop or restaurant in your area? Would everyone around you agree with this? No right? Why do you think so? Because everyone has their own personal needs and preferences. Someone would value the personal security that comes with an Apple phone and pay 50K extra - for this person, the best smartphone is an iPhone, and another may have a 40K budget and find another Android phone to do the job - with an array of apps not available on the iPhone.
In the above examples, we are talking about things which last say from 2 hours (a meal) to say 5 years (for a TV or a laptop). With health insurance, we are talking about a product that lasts for a lifetime and will serve you for a minimum of 35-40 years.
Spoiler alert: How can there then be a one-size-fits-all best health insurance product?
You are unique, and so are your family’s needs. The best health insurance policy is one that will cater to your specific needs and your specific use cases.
So, there is no health insurance that is best for everyone. But then how do you find the health insurance that is best for you?
In this article, we look at a step-by-step guide that will help you find a health insurance policy that is best for YOU. So, without any further ado, let's get started!
Health insurance is a long-term investment. As long as you pay your premiums and renew your policy on time, your health insurance policy will be with you for the rest of your life. One of the most important things you should remember when purchasing health insurance is that you are investing for the future. Hence, the sum insured you choose must be adequate not only for today but also for the future. And, while you're at it, make sure you also factor in inflation of 8 to 14% to ensure you are adequately covered.
Now, you may ask - Why should you invest in a cover that you don’t require right now? Why not upgrade the cover in the future?
Well, upgrading a health insurance cover is not a simple task. As you get older and develop any type of lifestyle disease or medical condition, it may become difficult to upgrade your health cover. The insurance company may either reject your application for a higher upgrade right away or charge higher premiums. Besides this, you may also have to serve additional waiting periods from the year of the upgrade. All these hassles, however, can be avoided if you invest in a sufficient sum insured today.
Next, you must have proper knowledge about the policy you’re planning to buy and the scope of its coverage. Here is a list of a few expenses that will be covered under health insurance -
- Inpatient care expenses
Inpatient care is the medical care you receive when you are admitted to a hospital for a specific treatment or surgery due to an illness, injury, or accident. Only if you undergo a continuous hospitalisation of 24 hours or more will your health insurance cover the costs of inpatient care.
Learn in detail about coverage of inpatient care costs in health insurance in this article: All about Inpatient Coverage in Health Insurance
- Pre/post-hospitalisation expenses
Pre-hospitalisation expenses are those incurred before a hospitalisation, whilst post-hospitalisation expenses are those incurred after you have been discharged from the hospital.
Learn in detail about coverage of pre and post-hospitalisation costs in health insurance in this article: Are Pre and Post-Hospitalisation costs covered by Health Insurance in India?
- Day care treatment costs
Day care treatment is completed in less than 24 hours at a hospital or a day care centre under general or local anaesthesia. A health insurance policy will cover the expenses of day care treatments.
Learn in detail about coverage of day care treatment expenses in health insurance in this article: Coverage of Day Care Procedures in Health Insurance in India
- Organ donor costs
An organ transplant requires two surgeries - one for the organ receiver and the other for the organ donor. A standard health insurance plan covers the organ receiver’s hospitalisation expenses. But, it will not cover the expenses incurred by the organ donor, like pre-hospitalisation tests, surgery costs, organ screening costs, etc. The organ donor may have to pay for all this themselves.
Note: If an organ donor cover is opted for with the health insurance plans to cover the expenses of the donor, they will not need to pay these costs out of their own pocket.
You can learn more about organ transplant coverage here: Coverage of Organ Transplant under Health Insurance in India
- Domiciliary treatment costs
These include those expenses that are incurred while receiving medical treatment at home because there are no beds available at the hospital, or you have a serious illness or injury that prevents you from being transferred to a hospital.
Learn in detail about coverage of domiciliary treatment expenses in health insurance in this article: Is treatment at home covered under Health Insurance?
Health insurance policies offer a variety of features/benefits. Some of these features/benefits will be inbuilt, while you may have to voluntarily opt for some. Here’s a list of a few features/ benefits that you should consider having in your health insurance policy -
- Restoration benefit
Restoration benefit is also called Restore, Reinstatement, Refill or Reset. With this feature, your health insurance sum insured will be restored/reinstated after it has been exhausted within a policy year. You can consider this benefit as a good backup for a rare but severe situation - because it comes with several terms and conditions.
Learn about these terms and conditions in more detail in this article: What is Restoration Benefit? How does it work?
- No claim bonus
A No Claim Bonus (NCB) is a feature in health insurance, where if you don’t make a claim in a policy year, the insurer gives you a reward. They will either increase your sum insured by a specific percentage or decrease your premium amount.
While NCB looks like a good benefit, it comes with certain drawbacks, which you can learn about in this article: 4 things to know about No Claim Bonus in Health Insurance
Some health insurance plans come with certain financial restrictions and limitations, and then there are plans that do not have any financial limitations. Check to see if the policy you are planning to buy has financial limits that prevent you from using the total sum insured you choose.
Here are a few financial limitations to be aware of -
- Room rent limit
It is the maximum amount that a health insurance plan will cover for per-day hospital room expenditures. A room rent limit will affect not only the cost of the room but also the total cost of your hospital stay. So, as far as possible, you should try to buy a policy without such a limit.
Learn how the room rent limit can impact your health insurance claim in this article: The truth about room-rent limits in health insurance
- Copay
The copay is a proportion of the approved claim amount that you will have to share with the insurance company. Basically, if a policy has a co-pay clause, you will be required to pay a set percentage of the approved claim amount from your pocket. The remaining claim amount will then be paid by the insurance company.
Learn in detail about how a copay works in this article: Here’s what you should know about Copay in Health Insurance
- Limits on treatment
There may be restrictions on the amount you can spend on particular treatments/surgeries. The most common financial limit in health insurance policies is for conditions like cataracts, knee surgery, etc.
- Limits on benefits
Benefits, such as domiciliary hospitalisation cover, organ donor cover, etc., may have financial limits under these benefits. Insurance companies may impose limits or a cap on the amount of coverage they will provide under these benefits. If you incur expenses that surpass the limit specified by the insurer, you may have to pay them out of your own pocket.
Exclusions are situations that will not be covered under the health insurance plan. The IRDAI has defined specific exclusions that health insurance plans will not cover at all. Insurance companies, too, may exclude specific illnesses or medical treatments from the coverage. So, to avoid unpleasant surprises when the policy is issued or at the time of a claim, make sure you are well aware of everything the health insurance policy won’t cover.
Additionally, when you buy a health insurance plan, you will not be able to make a claim from day one. All plans come with several waiting periods, i.e., the time span when the plan won’t cover certain conditions/situations -
- Initial Waiting Period: You can’t claim for any health conditions except accidents during the first 30 days.
- Pre-existing diseases waiting period: The IRDAI defines a pre-existing disease as any medical condition that was diagnosed or treated in the 48 months prior to the purchase of the policy. All health insurance plans impose a waiting period of 2-4 years for such pre-existing diseases.
- Specified disease/ procedure waiting period: Every insurer will provide a list of medical conditions that will have a waiting period of 2-4 years. For example, hernia, spinal disorders, chronic kidney disease, haemorrhoids, etc.
Learn in detail about health insurance exclusions and waiting periods in this article: Your Health Insurance Policy doesn’t cover that!
After you understand the features, benefits, exclusions, etc. the next step involves comparing the top insurance plans that are available in the market. You should compare the benefits, restrictions, exclusions, and other provisions we discussed above. Look for a policy that satisfies your requirements and has a cost that fits within your budget. Comparing these aspects will help you make an informed purchase decision.
You get a health insurance policy with the expectation that it will cover any future hospitalisation expenses and that you won’t have to arrange for funds. However, you can claim on a cashless basis only if you undergo treatment in a hospital on the insurance company's network hospital list.
Hence, while purchasing a health plan, you should check which hospitals in your neighbourhood are on the network list of the insurer you’re planning to buy from. Also, check whether a cashless facility is available with those network hospitals. This is important because you may not be able to file a cashless claim if the hospitals in your area are not on the insurer's network provider list.
Last but not least, it is also critical to examine the insurance company's claim history. Basically, you must check the –
- The number of claims settled by the insurance company out of the total number of claims received in a particular year.
- The time that is taken by an insurer to settle the claims.
- Complaints received by the insurance company.
All this will give you an idea about what to expect if you file a claim in the future. You can find these details on the insurer's website, your financial advisor's website, or the IRDAI's website.
Confused? Overwhelmed? Planning to buy health insurance but have questions, or doubts with regard to how to go about it?
Get on a free 1-to-1 consultation call with credible financial advisors vetted by us and get the right hand-holding for your health insurance purchase!
- There is no best health insurance policy available for all. The best health insurance policy is the one that is tailored to your specific needs.
- While buying health insurance, you must ensure you choose a sum insured that will be sufficient in the future, i.e., when you’re older and may have developed a health condition.
- You should thoroughly understand the scope of coverage of the policy you are planning to buy.
- You should go through the limitations and restrictions related to benefits/features before you go ahead.
- There will be specific situations that a health plan won’t cover. Understand these situations properly to avoid any surprises at the time of a claim.
- You should also compare the plans and check the insurance company's track record and their network hospital list before you move ahead with the purchase.
Aakansha is a Content Ideator and Writer at Beshak. With her easy-to-understand content, she makes insurance simple for everyone. She comes with a strong background in finance and commerce and wants to help families make positive insurance decisions that are good for a lifetime.