Know YourHealth Insurance Plan: The Different Types

Which type of health insurance plans are available in India? Do you know which one should you be choosing? Learn the types of health insurance plans.

If I ask you about your favorite chocolate what will be your answer? Amongst Mars, Galaxy, Cadbury, Toblerone, Ferrero Rocher, which one do you feel would be  your weak point? Just like there are so many varieties of chocolates available in the market, there are numerous varieties of health insurance plans too.

Health Insurance industry in India is seeing groundbreaking changes due to private insurance providers offering customized plans to the consumers. These plans are tailor-made considering the varied requirement of customers. For example, there are plans customized only for diabetic patients, cancer patients etc.

In short, health insurance plans are majorly divided into two categories.

Let’s have a look at the categories and the sub-categories of the Health insurance plans-

  1. Indemnity plans

Indemnity plans are also known as reimbursement plan because the insurance company reimburses the insured the actual hospital costs. This is irrespective from where he takes his health care services from.

For instance, if you buy a health insurance plan worth Rs.2 lakh and the hospital slaps a bill of Rs.1 lakh, the insurance company will reimburse Rs.1 lakh fully. But, if the bill would have been Rs.2.30 lakh Rs.2 lakh would have been the amount compensated by the insurance company. And, Rs.30,000 would have to be borne by you.

Indemnity plans are further sub-categorized as below-

  1. Mediclaim Plans

The Mediclaim plans are like old-school plans wherein hospitalization costs, pre and post hospitalization costs, ambulance costs, costs of surgeries are all taken care off. These expenses will be compensated in case of the following situations-

  • Sudden illness
  • Accident
  • Surgery during the policy tenure
  1. Top-up Plans

As the name suggests, these plans either tops-upor increases your coverage amount. In short, top-up plans helps in extending your threshold limit ones exhausted. This can be done at a very minimal cost. It works on per hospitalization basis. Meaning, top-up will pay you only you exceed your threshold limit for a single hospitalization.

For example, if you have a health insurance plan with a sum assured of Rs.6 lakh and you have also opted for a top-up plan worth Rs.5 lakh. If you claim anything more than the sum assured then the balance amount would get utilized from the top-up post utilizing the base amount of Rs.6 lacs. But, if you claim any amount more than Rs.11 lakh (Rs.6 lakh + 5lakh), then the left over amount would be borne by you.

  1. Super Top-up Plans

Super Top up plans covers multiple hospitalization and considers the aggregate claim. To calculate the deductible they club together several cases of hospitalization.

For Example, if you have two claims of Rs.50,000 and Rs.60, 000 in any policy year wherein your deductible is Rs.1 lakh, super-top plan will pay you the balance Rs.10,000 which would not have been paid by the top-up plan.

  1. Defined Benefit Plans

The defined benefit plans or the fixed benefit plans are exactly opposite of indemnity plans. Here, in case of a claim, the insurer pays a pre-specified amount irrespective of the actual expense.

For instance, if you have a daily hospitalization cash benefit of Rs.4000, the plan will pay you Rs.4000 irrespective of the actual amount being Rs.2000 or Rs.3000.

There are different types of benefit plans-

  1. Critical Illness Plans

These plans provide coverage specified to a critical illness. The amount here is paid in lumpsum to the insured regardless of the subsequent treatment costs.

  1. Hospital Daily Cash Plans

In simple terms, a hospital daily cash benefit plan will provide a fixed amount per day if you get hospitalized. This amount is pre-fixed and nowhere depends on the actual hospitalization expense.

To sum up, no one opts for a plain dairy milk when there are so many better flavors like Ferrero rocher and Lindt chocolates available in the market.

Therefore, it is always recommended to opt for an Indemnity cover along with the other covers like critical illness plans, daily hospitalization cash benefit plans etc. You can also go with the super top-up plan to increase your coverage.

Author: Robin Gupta