Restoration Benefit / Restoration of Cover in Health Insurance
May 4, 2021

Restoration Benefit in Health Insurance

It is 2021 and in this new decade, the world is amidst dealing with a pandemic situation. Health that took a backseat in our daily hustle managing work and personal lives, has suddenly gained prominence. The adage, health is wealth has strengthened its foundation again. Keeping all of this in mind, availing a health insurance policy is of prime importance.   When buying a health insurance policy, the first thought that strikes is what if it gets exhausted. But modern-day policies come equipped with a host of features, one among which is the restoration benefit.   What is restoration of cover in health insurance, you may ask.   Restoration benefit is a facility where the insurance company restates the sum assured of your insurance cover to its original amount once it is exhausted. With this feature, you need not worry even if you end up exhausting the sum assured of your health cover. Let us understand the restoration benefit in health insurance with an example.   Mr Kishan has a family health cover of ₹8 lakhs with restoration benefit. Due to his critical heart condition, he had to undergo an operation where this entire amount of sum assured got exhausted. Now in the following months, he suffered from a stroke and had to again get operated for which the treatment cost was ₹4 lakhs. Since a restoration benefit is available for the insurance policy of Mr Kishan, the second treatment is also covered by his insurance company.   Why is it essential to have a restoration benefit in health insurance plans? With the growth of lifestyle diseases and soaring treatment costs, it often happens that the sum assured amount may seem inadequate after a few years. At this time, having a backup plan in the form of restoration benefit will act as a safeguard, thereby providing additional coverage if required. Thus, make the right choice and opt for a recovery benefit in your health insurance policy.   What are the types of restoration benefits that you can purchase? There are two types of restoration benefits in health insurance plans, complete exhaustion and partial exhaustion. Selecting either of them should be purely based on your coverage you need and thus, reading the fine print is advisable.   In complete exhaustion restoration benefit, the insurance company will reinstate the sum assured only if you exhaust the entire sum assure. For instance, your policy has a sum insured of ₹10 lakhs and you make a claim of ₹6 lakhs followed by another claim of ₹7 lakhs. Only after the second claim is paid up to ₹4 lakhs, the insurance company will restore the sum assured.   For partial exhaustion method, the insurer will reinstate the sum assured after availing some part of the insurance coverage. In the above example, the insurance company will reinstate the sum assured to the original amount of ₹10 lakhs after the first claim itself.   Who should avail the restoration benefit in health insurance plans? Our advice shall be anyone and everyone who can afford this additional feature should opt for it. A case of multiple hospitalisations is rare, but so are medical emergencies. But if not for all, then at least health insurance plans for family should be loaded with a restoration benefit. When you purchase a recovery benefit in your health insurance plan, the entire sum assured that ‘floats’ between the beneficiaries can be restored for it to be available for other members of the policy.   To conclude, take advantage of this additional feature. It will save you from financial hassles and offer mental peace knowing you have a backup even though you end up using your base policy coverage.

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