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How to verify and change your health insurance cover periodically?
Jun 14, 2012

Know All About Managing Your Health Insurance Cover

As health expenditures increase, government spending on health care is reducing. This makes health insurance a necessity for the common man, to protect his lifestyle and income from unforeseen medical costs due to illnesses, hospitalisation or accidents. Where before, only people in metro cities went for health insurance to offset the higher cost of healthcare, today mid- and small-town residents are also opting for health insurance.

But are people aware of how much insurance they should buy? Is it just a matter of buying a policy and assuming it’s sufficient, or choosing the right sum insured from the get go? So if you look at the market, you have all types of health insurance in India policies with sum assured ranging from Rs.1 lakh to Rs.50 lakh. Of late, we see that the demand for 1 lakh is reducing, because of its perceived inadequacy to provide a sufficient cover.

  How much coverage do you need?

If you live in a metro city, an amount of Rs.3-5 lakh is what you should be looking at for a start, when it comes to buying a health cover. Whatever the initial sum insured you choose, it will need to increase with time, or based on your need. You can look at a higher sum insured if you are averse to risk or want premium facilities at the hospital, like luxurious rooms, etc. One thing good with buying a higher sum insured is that the overall premium per lakh is ultimately lower.

However, to really know how much coverage you need, it is important that you first understand the risks that surround you and how your need may be affected by them:

  • You can fall sick, which may entail huge medical expenditure. We recommend family health insurance plans, because you pay a significantly lower premium, while covering more people. Suppose you have a 3-member family. If each one of you gets a health insurance policy of Rs.3 lakh, with premium for each being about Rs.3000-5000, then you end up paying anything between Rs.9000-15000. On the other hand, if you get a floater cover of Rs.3 lakh, you would pay about half that amount, while covering all three members of your family.
  • Most youngsters buy a car within the first couple of years of their job. Within 5-8 years, a lot of them take a home loan too. Suppose you bought a car and home, with total loan coming to Rs.45 lakh, which is your liability. If you then suffer an accident and become disabled, or fall seriously ill (cancer, kidney failure, or other critical illnesses) and lose your job, you will be left with extensive medical bills, no income AND a huge liability. It is for cases like these that one should have critical illness insurance, which pays in case of such a disease affecting you. Getting a critical illness cover will bridge the gap between your need and your insurance cover. The cover you have should be as much as your liability, at least. It should be enough to wipe out your debt, so that you don’t have to live with debt as well as disability in the absence of a steady flow of income. For a young person, getting a critical illness cover of Rs.40 lakh will be neither difficult nor expensive.
  You bought your health insurance. How should you change your cover over a period of time?

Healthcare costs are increasing by 15-20% per annum. So if you bought a cover of Rs.5 lakh initially, next year the real value of the cover will be 20% lower. And in five years’ time, the real value will be half of the current value. In basic terms, your insurance begins to cover less and less as time goes by. For example, if an operation costs Rs.3 lakh today, 1 year later it shall cost Rs.3.6 lakh.

Your sum insured should be revised the moment you have a family – after marriage and after a child. Your cover should also increase with your income and your position. Your expectations of the facilities at hospitals increase with increase in income – at an annual income of Rs.6 lakh, you may be happy with a standard room, but at an annual income of Rs.15 lakh, you will probably want a super deluxe room. Another situation in which your cover needs to be increased is if you move from a small town to a larger city. You will find that medical expenses go higher, and increasing your sum insured in such a case is a good idea.

To keep your cover at an adequate level, your cover should keep pace with inflation. Therefore, it should increase by anywhere between 10-20% every year. Since most insurance companies do not offer such flexibility with the sum insured (the next highest sum insured is usually Rs.50000 or Rs.1 lakh more), you can choose to increase your cover every two years or so.

Know more about how you can supplement your health insurance policy with top-up covers.

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  • Nandu - September 4, 2015 at 5:29 pm

    You have mentioned the following in your article “To keep your cover at an adequate level, your cover should keep pace with inflation and you can choose to increase your cover every two years or so”.
    1. Do you have any policy where the insurance cover increases every year or once in 2 years?
    2. If no such policy exists, can you pl. suggest how can this cover increase once in 2 years can be achieved without every time taking a new policy?

    • Bajaj Allianz - September 10, 2015 at 6:22 pm

      Auto increase of Sum Insured option in health insurance is currently not available. However, the best way to keep pace with inflation is to increase the policy cover during renewal of the policy. This way you can retain the renewal benefits and do not have to take a new policy. Hope this helps.

  • ram - March 26, 2013 at 12:17 pm

    Can you issue health insurance for kidney transplant receipent / donor , can you mail me the details thanks

    • CFU - March 27, 2013 at 10:36 am

      Dear Ram,

      Please provide us the updated contact details so that we can arrange the call back from our sales department.

      Thanks and Regards,
      Help and Support Team

  • prashant - March 22, 2013 at 12:15 am

    please send my police of OG-13-1901-8403-00000077 on my mail

    • CFU - March 22, 2013 at 9:16 am

      Dear Prashant,

      We want to inform you that, you have opted for corporate policy we request you to kindly co-ordinate with your company HR.

      Thanks and Regards,
      Help and Support Team

  • Chandrasekhar - March 12, 2013 at 9:55 pm

    I need copy of my policy No. og131828840100000005…Need this for tax purpose. can u send it by mail ?

    • CFU - March 15, 2013 at 12:27 pm

      Dear Chandrasekhar,

      We will send you a soft copy of the policy on your email id.

      Thanks and Regards,
      Help and Support Team

  • snehal vichare - February 20, 2013 at 9:02 pm

    I have renewed my policy on 17th february. my health policy no is 0155060536 my id card no is BAL -0155060536-31509
    i want to ask you that till to date i have not viewed my policy details and status of my health policy. please do the needful and let me know the procedure.

    thanking you

    snehal vichare

    • CFU - February 26, 2013 at 6:48 pm

      Dear Snehal,

      We are examining the matter on priority basis and would revert to you with the corrective at the earliest.

      Thanks and Regards,
      Help and Support Team

  • Sanjay Vasant Darekar - February 13, 2013 at 3:51 pm


    During my home transfer all documents of my health policy are misplaced. Can I get my Insurance No from your database on my e-mail ?

    • CFU - February 14, 2013 at 3:11 pm

      Dear Sanjay,

      Thanks for writing to us.

      We request you to, kindly provide us the policy number and updated contact details so that we can do the needful.

      Thanks and Regards,
      Help and Support Team

  • Vivek Shah - February 11, 2013 at 9:57 pm

    I received my health insurance from my employer but could not find the exact value of the health cover.Also on website I could not find any place from where I can get the details. Request you to furnish me with the details on my email id. My policy number is

    Vivek Shah

    • CFU - February 12, 2013 at 11:24 am

      Dear Vivek,

      Thanks for writing to us.

      We want to inform you that, you have opted for corporate policy we request you to kindly co-ordinate with your company HR.

      Thanks and Regards,
      Help and Support Team

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