6 Key Points to Check when Comparing Health Insurance Plans

With the ever-evolving insurance market and the vast array of options available, it's essential to understand the key factors to consider when selecting a plan that best suits your needs. In this article, we'll break down the process of buying a health insurance plan into six easy-to-understand steps, helping you make an informed decision.

The primary aspect to consider before investing in a health insurance plan is understanding the requirements. Here are some points that you need to evaluate before investing in a health insurance plan:

• Number of people you want to include in the health insurance policy


• The coverage that you think shall be adequate


• Keeping in mind the medical history of yourself and your family any specific coverage to be included in the policy like diabetes coverage, cancer cover, etc.


• The premium amount

Once the above basic requirements of the health insurance cover are listed the next step is to undergo a thorough evaluation of various insurance companies. The evaluation of the insurance companies can be done based on the following factors:

1). Network Hospitals

This refers to the hospitals that have tie-ups with your health insurance provider so that you and your family can avail of medical facilities without worrying about the money. When a hospital is a network hospital under a particular health insurance policy it means that the health insurance holder can avail cashless medical facility. Therefore, ensure that your preferred hospital or one in your vicinity is included in the network to avail of the cashless facility.

2). Claim Settlement Policy

The claim settlement process refers to the time taken by the health insurance provider to approve the medical treatment. It is important to understand the plan's claim settlement process, which can be either cashless or reimbursement. Out of the two, a cashless facility is more convenient, as the insurer directly settles the claim with the network hospital. While a reimbursement claim requires you to bear the expenses upfront and then seek reimbursement from the insurer. Ensure the insurance company's claim settlement record for a smooth and hassle-free claim settlement process.

3). List of DayCare Procedures

Daycare procedures are medical treatments that can be done in a hospital or clinic without requiring an overnight stay. The more daycare procedures are covered by the insurance plan, the better. Therefore, have a comprehensive list of covered daycare procedures to ensure that you can get treatment for a wider range of medical conditions without having to be admitted to the hospital.

4). Solvency Ratio

The solvency ratio indicates the financial strength of the insurance company. It shows the company's ability to pay claims. The minimum solvency ratio mandated by the regulator (IRDAI) is 150%. A higher solvency ratio, above 150%, suggests the insurance company is in a stronger financial position to fulfil its obligations to policyholders. You can check the solvency ratio of the insurance company in the IRDAI Annual Report.

5). Overall Track Record

This refers to the overall performance and reputation of the insurance company. This can be understood by considering factors like the range of insurance products offered, Time taken to issue policies, Quality of claims servicing, and resolving policy-related queries. Additionally, you can check the company's ratings, reviews, and feedback from existing customers to get a sense of its overall track record.

A company with a good reputation and track record is more likely to provide a better overall experience as a policyholder. When you've determined your health insurance requirements and evaluated different insurance providers, the next step is to compare the health insurance plans offered by these companies.

Here are the key factors you should consider when comparing health insurance plans:

6). Waiting Periods

Understand the various waiting periods in the plans, such as:

• Initial wait duration of 30 days (except for hospitalisation in the event of an accident)
• Waiting period for specific diseases/procedures (e.g., cataracts, varicose veins)
• Waiting period for pre-existing diseases (24-48 months)
• Waiting period for maternity cover (9-48 months)
• Waiting period for critical illness coverage (90 days) along with a survival period of 30 days post the diagnosis of critical illness.
• Waiting period for procedures like bariatric surgery.

Pro tip: Look for plans with the lowest waiting periods, as they are more beneficial.

Restoration Benefit: While buying a health insurance policy for the family one of the important factors to look out for is the restoration benefit. This feature ensures that the full sum assured is restored within the same policy year if the initial sum is exhausted due to a major hospitalisation.

Room Rent Limits: Some plans impose a limit on the daily room rent, either as an absolute amount or a percentage of the sum assured. So while selecting opt for plans with either no room rent limits or higher limits to avoid out-of-pocket expenses.

Annual Health Check-ups: health insurance companies offer annual health checkups either free or paid. These health check-ups are extremely beneficial as they help in maintaining a healthy lifestyle.

Co-payment Clause: As the name suggests co-payment refers to bearing a certain percentage of medical cost incurred of the medical bill. The percentage of the co-payment ranges between 5% to 25% of the hospital bill.

• Pro tip: opt for a health insurance plan with either no co-payment or a lower co-payment percentage to minimise your out-of-pocket expenses.

No Claim Bonus: NCB or the No Claim bonus is a bonus offered by insurers if you don't make any claims during the policy year. The NCB is offered as a discount on premium renewal or a percentage increase in SA of the health insurance policy.

• Pro tip: Choose a plan with a higher NCB rate and a higher maximum NCB limit.

By carefully considering these factors, you can identify the health insurance plan that best meets your needs and provides the most comprehensive coverage at an affordable premium. Additionally, you can also compare health insurance plans based on:

• Coverage Scope and Extent: Look for a plan that covers a wide range of medical expenses, including Doctor's fees, ICU room rent, Pre- and post-hospitalisation costs, Ambulance charges, etc. Additionally, consider additional benefits like coverage for domiciliary expenses, OPD expenses, and alternative treatments (Ayurveda, Homeopathy, Unani).

• Exclusions: Understand the list of exclusions in the plan, as not all medical expenses are covered. Some of the common exclusions include Pre-existing illnesses, Dental or cosmetic treatments, Congenital defects, etc.

By comparing the features of different plans side-by-side, you can better understand the trade-offs and choose the one that best fits your requirements and budget. Remember, the health insurance market is constantly evolving, and new and improved plans are being introduced regularly. It's essential to stay informed and consult with a trusted insurance advisor to ensure you make the right decision for your health and financial well-being.

Read More: Benefits of Buying Health Insurance Online