Service Chat: 
Designing Your Health Insurance Cover
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Last time I spoke to you about the adequacy of sum insured – why you should look at an increased sum insured compared to what you took at the inception of the policy. I’ve talked to a lot of customers and friends, and realised that our understanding of the health policies and products in the market is not across the spectrum. So if we talk about health policy, we are talking about buying a single health policy. We talk of the sum insured and also of increasing it from time to time, but that is not the way it should be looked into. To be fair to the industry, I think the number of health policies being offered, with different kinds of covers, is good. I’d say there’s a huge spectrum of policies out there.
Structuring Your Health Insurance
The issue under discussion today is – how can you design your health cover? What should you look into when you do that? For example, if you have illnesses which are not critical in nature, what is the maximum you are likely to spend on your healthcare? What is the maximum spend that can happen because of diarrhoea, or dengue, or malaria? To my understanding, around Rs.70000-100000. Anything which goes beyond that would be in the vicinity of critical illness, such as a heart attack or cancer or knee replacement or kidney failure.
So why don’t we look at a health guard, of Rs.2 lakh cover? That would be the basic cover we take for normal illnesses. Then we have critical illness covers, which we should take for about Rs.20 lakh. Additionally, we have a hospital cash cover, because the other policies only provide support for the expenses you incur in the hospital. The reality is that when a patient is admitted, there are many things that go beyond the hospital bill for treatment alone. You have visitors coming and other miscellaneous expenses happening. Most insurance companies have this beautiful cover called hospital cash in which per day, a fixed amount of money is given, irrespective of what you spend on hospitalisation, as that is the reimbursement part of regular health insurance policies. Hospital cash is typically there to take care of miscellaneous expenses beyond those incurred in hospitalisation.
Basically, for a comprehensive health cover, you can look at combining health guard, top-up, critical illness and hospital cash at varied sums insured. The entire spectrum of your health needs will be covered and you’ll be surprised to know that for the amount of money you would pay as premium in buying a health guard of Rs.10 lakh rupees, you would probably be able to get a better range of coverage if you opted for a combination of different products instead.
Why You Need a Range of Covers
In times to come, with the way medical sciences are improving on a daily basis, my personal experience says that medical expenses are going to go up like anything. The reason is not because diseases are growing more severe, but because of the sheer sophistication of the treatments which will be coming in and slowly becoming the norm. In light of all this, it’s good to have your policy early. It’s very good to have your health insurance policies in place when you’re fit and fine so that you’re covered for any exigencies that happen later in life. That’s the primary viewpoint one should take when structuring one’s health insurance.
Choosing a Provider
When it comes to a provider, you should look at a provider who:
-
- - has been consistent in the market,
- - is a long-term player,
- - is sustainable,
- - whose balance sheet looks good, and
- - who has dominance in the market in terms of which places it can reach.
Such a provider would be able to:
- - negotiate and get you the best rates from the hospitals,
- - provide you the best of services on a long-term basis.
So just why should we take the designing of our health insurance so seriously? The answer is simple – when you take a health policy you don’t take it for one year. You take a health policy for a lifetime. Companies that match that should be the ones that you prefer. That is my take on designing a health cover.
About the author
Tapan Singhel is the MD & CEO of Bajaj Allianz General Insurance Company Limited. This blog has been initiated by him so that he can directly interact with all the valuable customers and employees of this company.
Chief, I feel it's time to create more comprehensive but distinctive products which provide all round protection. I am in complete agreement with U, when U say that the awareness is quite a lot better on the subject of health care, but a consumer is confused with the clutter of health products available today. Of course the brand and the service parameters do differentiate the insurance company, but think it's time for health insurance to move to the next level. Unique offerings with the right positioning and branding should create a pull rather than a push which is still happening in our industry.
Dear Sreekanth, We believe in maintaining transparency in our policies and services. Our health policies Health Guard, Silver health, Tax Gain, and Extra Care are designed to take care of hospitalization expenses. These policies do not have any restriction or limitations on room rent and other expenses, including doctor's fees, OT charges, medicines, and investigations. The definitions listed under the policies are recommended by IRDA and are included across all health insurance policies as per IRDA specifications. We also ensure that our policy wordings include details about day care procedures, all definitions, conditions and exclusions, so that the customer can examine the policy thoroughly before purchasing it. Through our website, the customer can get in touch with any of our nearest offices for further details about the policies, if required. We also have a toll-free call centre to take care of product related queries, claim process, and grievances.
Sorry sir, you got it completely wrong! What customers want is a health care policy which doesn't limit my room rents without an additional premium, a 1% of SI of a Rs. 3 Lak works out to be Rs. 3k. I'm unsure how practical is this clause in today's costly world. What customers want is a real and honest policy which doesn't print the definition of "Hospital" in its fine print hidden at the end. When I was hit in an accident, no one on the earth counts the number of beds the hospital has, rather just admit in the nearest hospital only. Excellent reason for so called Health Insurers to reject the claim. What customers need is a cash plan which doesn't say there must be hospitalization for minimum 24 hours only. After all, the miscellaneous charges occur for day-care treatments also. I can continue on this... Concisely, please work on something which is transparent to the customers. Customers don't care if you are a short, mid or long term player as long as the features are beneficial. L&T, Max Bupa, Aegon, Aviva, ICICI, HDFC, Bajaj there are many long term players for me to choose but I just feel difficult as there are no honest players in the industry. IRDA should learn a lot from TRAI!