Buying health insurance? Seven key things you must check

Insurance often holds surprises for policyholders when they need it the most. You must have heard many such stories. Therefore, reading the fine print before purchasing a health insurance plan is essential. Sure, reading the terms and conditions of a plan may seem daunting, but you can use a quick shortcut (Ctrl + F) to search for the important terms by accessing the document online.

The keywords you need to look out for in the specimen are as follows:

Sub-limit

• What it means: Many health insurance policies add specific sub-limits, which cap expenses like room rent, ICU charges and doctor's fees. For instance, a policy might restrict room rent to 1 per cent and ICU charges to 2 per cent of the total insured amount. For example, a Rs 10 lakh policy may only cover up to Rs 10,000 for room rent and Rs 20,000 for ICU charges per day.
• What you should do: Please check the sub-limit. Having a low sub-limit for basic expenses like room rent can be problematic when you need care the most. In fact, it's better to pick a plan without these restrictions. The fewer the sub-limits, the more beneficial the plan.
• Did you know?: Health insurance plans typically under Rs 10 lakh are more likely to impose such sub-limits.

Co-pay

• What it means: This clause requires you to pay a specific percentage of the medical expenses. For instance, if there is a 10 per cent co-payment clause on a hospital bill of Rs 5 lakh, the insurance company will cover up to Rs 4.5 lakh. The remaining amount, which is Rs 50,000 in this case, will have to be paid by you.
• Did you know?: That said, this clause usually applies to policies for people aged 60 and above. It's crucial to review this aspect, especially when purchasing health insurance for seniors.
• What you should do: Needless to say, a policy with a lower co-payment percentage is preferable.

Exclusion

• What it means: Insurance policies don't cover all medical conditions and treatments. These exclusions can be split into permanent or temporary. For instance, dental care, cosmetic procedures and HIV treatment are typically not covered by health insurance and are considered permanent exclusions.
  
  For pre-existing conditions like diabetes and hypertension, coverage begins after a 'waiting period', which can range from two to four years, depending on the insurer. These are temporary exclusions.

• What you should do: If you have illnesses or conditions that fall under 'temporary exclusions,' aim for a policy with the shortest waiting period possible.

Restoration benefit

• What it means: This perk refreshes your sum insured if it's used up within a year. Assuming a Rs 10 lakh insurance plan is exhausted due to hospitalisation, insurers replenish the entire amount. In other words, your policy's sum insured is restored to the original amount of Rs 10 lakh.
• Did you know?: Some insurers allow unlimited restorations, while others cap it just once. Further, some policies do not allow the restoration benefit for the same illness and treatment.
• What you should do: While restoration benefits might seem appealing at first glance, they could be a costly feature. Hence, it's wise not to prioritise policies based solely on the number of restorations, as they can significantly increase premiums.

Annual medical test

• What it means: Increasingly, insurance policies are offering coverage for annual health check-ups.
• What you should know: While this isn't a required benefit, it's certainly worth considering. That said, do investigate in which centres these check-ups can be performed, the types of tests included and if you can avail of these services on a cashless basis.

Pre- and post-hospitalisation

• What it means: Most health plans cover treatment expenses before and after hospitalisation.
• Did you know?: The duration of the treatment period can differ.
• What you should do: Ideally, you should seek a plan that offers at least 30 days of coverage for treatments before hospital admission and between 30 to 60 days for care after discharge.

Domiciliary hospitalisation or treatment at home

• What it means: COVID brought this clause into sharp focus. This feature becomes relevant when hospitalisation is necessary but impossible, either due to a lack of available beds or because the patient's condition prevents them from being transported to a medical facility.
• Did you know?: It's common for insurance companies to impose certain restrictions on this benefit. For instance, they often allow at-home treatment for up to three days only.
• What you should do: Having home healthcare options in your insurance plan can be advantageous, assuming this added feature doesn't significantly increase your premium.

To conclude, we suggest you check for terms like sub-limits, co-pay, exclusions and restoration benefits and consider perks like annual health checks, pre- and post-hospitalisation benefits and at-home treatment features.

Making informed decisions means you're not just buying health insurance, you're investing in peace of mind in times of trouble.

Also read: How to save big on your health insurance premium