A health insurance plan acts as a security measure in the event of a medical emergency. A top-up health insurance plan increases the coverage amount over and above the base medical insurance policy at a reasonable cost.
What are the two types of top-up health insurance plans?
There are two types of top-up health insurance plans — regular and super top-up plan.
A regular top-up plan
offers additional coverage beyond the deductible or threshold limit of the existing health insurance plan. It only caters to a single claim above the deductibles per year. If the hospital bills do not exist the deductible, the top up health insurance will not get activated.
A super top-up plan
offers additional coverage above the deductible amount and covers multiple claims for cumulative medical expenses over the deductible amount within a year. A super-top-up plan ensures the policyholder gets the medical treatment without any limitations.
What is deductible in super top-up?
Deductibles are the cost-sharing requirement by the health insurance company. In a simple way, deductibles are the fixed amount borne by the insurance company regardless of hospitalization claims within the policy period.
Deductibles help the health insurance companies share the cost with the policyholder. When a policyholder buys the super top-up health insurance plan, he has the option of choosing a specific deductible amount.
Ms. Kaur purchases a medical insurance policy of INR 3 lakhs. One day while having a conversation with her sister Ms. Singhania, they discussed medical inflation in today’s world. It makes Ms. Kaur worried about the policy amount won’t suffice for her medical emergency in the future, and what if there will be significant events?
Her sister Ms. Sighania asked her instead of increasing the medical policy amount and paying a higher insurance premium
. She suggested that she buy a super-top up plan of INR 7 lakhs. The super top-up health insurance plan will kick-in if the hospitalization bill will be above the deductible amount.
But the question arose in Ms. Kaur’s mind, as there will be the deductible in health insurance policies, what is deductible in super top-up? Her sister told her that in super top-up health insurance, the policyholder could choose the fixed deductible. Hence she determines a deductible amount of INR 3 lakhs.
In Ms. Kaur’s case, along with the medical insurance premium, she has to pay INR 3 lakhs as a deductible amount of the super top-up health insurance policy she purchases for the extra coverage.
Later after a year, Ms. Kaur needs to undergo heart surgery, and her hospitalization bill raises to INR 5 lakhs. As the hospitalization bill amount is above the deductible amount; thus, INR 3 lakhs will be covered by medical insurance, and a super-top up plan insurer will cover INR 2 lakhs.
Within six months, she again needs to be admitted, and the hospital bill is raised to 4 lakhs. In a Super top-up health insurance plan, the policyholder can claim multiple tabs in a year. Thus Ms. Kaur’s bill of INR 3 lakhs will be settled by the medical insurance company, and INR 1 lakh settled by the super top-up health insurance company. Therefore, Ms. Kaur didn’t have to pay anything extra from her pocket.
Which health insurance policy recommended for the family floater plan and has a sufficient deductible amount?
Bajaj Allianz Extra Care policy offers coverage ranging from INR 10 lakhs to INR 15 lakhs, with the deductible ranging between INR 3 lakhs and INR 5 lakhs. It comes with a family floater medical insurance plan; hence its works per claim basis.
When does the super top-up health insurance policy lapse?
Super top-up health insurance policy lapses when the whole amount is consumed because it entertains multiple claims.
If you have a basic health insurance or mediclaim policy, it is advisable to buy a super top-up health insurance policy. In the top-up plan, the deductible is applied on each claim, while in the super top-up health insurance plan, the deductible applies to the total medical expense incurred in the year.
The deductible can go higher as per the policy the policyholder is purchasing depending upon their needs. Some insurers have an age proposal of up to 70 years to benefit a single sum insured for the whole family. The benefits can differ from one insurer to another.