Elements of Health Insurance – Terminologies & their Benefits

Posted on: Jan 3, 2019 | | Written by:

Elements of Health Insurance – Terminologies & their Benefits

Health Insurance, in the present day and age, has become indispensible for each one of us. It ensures you of the medical expenses that might be incurred by you in the future. There are various typesofhealthinsurancepolicies available like the individual health insurance policy, family health insurance policy and even group insurance policy. Depending on the need and requirement you can opt for any type of health insurance policy.

Below are terminologies that are commonly associated with health insurance policies and their significance

1. Add-on Covers:

Health insurance add-on covers are additional features also known as optional covers or riders. These are additional features in health insurance that offers added financial cover against unknown medical emergencies involving higher medical costs. Some of the add-on/optional covers that you can choose to improve your health insurance plan are critical illness cover, maternity cover; hospital cash benefit, etc.

2. Automatic Restoration:

Currently, most health insurance plans offer 'restoration benefit'. This means that the once you have claimed your sum insured, it gets restored again. In case the entire sum insured is exhausted, it gets reloaded automatically for the next hospitalization during the policy term.

3. Pre-existing Diseases:

Health conditions like COPD, hypertension, diabetes, kidney problems, cardiovascular issues, and other underlying ailmentsare considered to bemajor risk factors in terms of health insurance. Patients with pre-existing medical conditions as mentioned above are assumed to be at a higher risk and are therefore charged a higher premium.

4. Co-payment:

The copayment or co-pay clause is a fixed percentage of amount that the insured/policyholder has to pay to the insurance company before receiving the healthcare service. It is written in the policy wordings.

5. Critical Illness:

Critical illnesses or life-threatening medical conditions are serious medical conditions like cancer, kidney failure, and cardiovascular diseases. There are special medical insurance plans that cover these illnesses. The critical illness health insurance can be purchased as a rider or add-on cover.

6. Cashless Claims:

The health insurance claims filed for a medical treatment availed in the network hospitals is called cashless claims.

7. Deductibles:

Deductibles can help you reduce your policy premium, but at the same time, it can also mean that you have to pay a fixed sum at the time of insurance claim. Check the policy documents carefully for the deductible clause.

8. Inclusions:

The policy features and benefits that the insurer will bear the expense for is known as coverage benefits or inclusions. It includes hospitalization expenses, ambulance charges, surgery, hospital room bills, anesthesia, medicines, and treatment-related expenses.

9. Exclusions:

The limitations of a health insurance policy are called exclusions. These are usually mentioned on their website and in policy wordings clearly. These are the conditions and situations under which your health insurance claims can get rejected.

10. No-claim Bonus:

Health insurers offer a benefit termed as No-Claim Bonus (NCB), in which the policyholder is rewarded for not submitting a claim in the preceding years.

11. Network Hospitals:

Every insurer has a tie-up with a certain number of hospitals known as the network hospitals. These hospitals are the ones where you can avail treatment without the need to pay the bills; the insurer settles the bill directly up to the coverage limit.

12. Premium:

The amount that you need to pay the health insurance company against the policy purchased is termed as health insurance premium. The premium depends on the policy type, the sum insured, age of the policyholder, and various other factors.

13. Sum Insured:

The policy coverage amount is termed as the sum insured. The insurer pays an amount equal to the sum insured. The amount depends on the health insurance policy you have purchased.

14. Top-up Plans:

If the sum insured of the base policy gets utilised, your top-up plan will cover the cost of the treatment.These are the policies that you can purchsealong with your base policy.

15. Waiting Period:

There is a fixed time-period in health insurance before which you cannot get benefits of the coverage you purchased. During the waiting period, you cannot submit health insurance claims. The waiting period depends on thetype of health conditions you have and the coverage that has been bought.

Conclusion

The above are some of the important terms of health insurance that will help you choose the best health insurance policy in India. Being aware about these terminologies beforehand will help you in the long run. This will help you to make smart decisions for yourself and your family, especially in terms of medical insurance.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

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