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HEALTH INSURANCE

Showdown: Top-Up vs. Super Top-Up Plan

Neha Gadoo Neha Gadoo 23 September 2016

Most of us go about our lives without securing our medical expenses in totality. You might say you have a Medicare policy, but more often than not, the coverage value of a personal health insurance is Rs. 3 to 5 lacs.

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Needless to say, there’s a need for higher coverage, and that’s where top-up or super top-up plan comes in. In order to help you choose the best option, we have made a comparison chart between the two – the ultimate showdown! Yes, it sounds dramatic, but won’t be so when your sky-high medical bills are not drilling a hole in your pocket.

Top-up PlanSuper Top-up Plan
MeaningTop-up health insurance plans cover policies that offer an additional coverage, beyond the threshold limit of the existing health insurance policy.Super top-up plans are similar to top-up plans, except that top-up plan covers a single claim above the threshold limit, while the super top-up plan covers the total of all hospitalization bills above the threshold limit.
SITUATION: Basic health insurance policy of Rs. 2 lacs and Top-up/ Super top-up plan of Rs. 10 lacs, with a threshold of Rs. 5 lacs.
A. What happens when a single bill of Rs. 8 lacs is generated?Basic health insurance will pay Rs. 2 lacs.

The balance 6 lacs will be paid by the top-up plan.
Since the single amount of bill is less than the top-up value, there will be no difference between top-up and super top-up plan.

The difference arises if the expenditure happens in separate hospitalization charges, demonstrated herein.
B. What happens when more than 1 bill are generated –
1) Rs. 6 lacs
2) Rs. 2 lacs
3) Rs. 1 lac
Basic insurance will pay Rs. 2 lacs (as that’s the minimum amount covered).

Top-up insurance will pay 4 lacs (as the amount of 1st bill is more than threshold limit of Rs. 5 lacs).

The other expenses will have to be borne by the patient himself.
Basic insurance will pay Rs. 2 lacs.

Super top-up will pay balance Rs. 4 lacs.

Super top-up will also pay the next two bills of Rs. 2 lacs and Rs. 1 lac, since the total expenditure of hospitalization exceeds the threshold limit of Rs. 5 lacs that very year.
Which one to prefer?If you do not suffer from a chronic ailment, or run the risk of a terminal illness, a top-up plan would be suitable to your needs.

After all, you have to be extremely unfortunate to find yourself in life-threatening situations more than once a year!
If you run the risk of being hospitalized more than once a year from chronic diseases, it is best to pay for a super top-up plan.

The premium amount would pinch much less when you save on a hugely draining amount as hospitalization charges.

The taxation and other benefits on both these claims are, more or less, the same. Hence, the decision to choose a plan would be simply on the basis of your health requirement.

Fair warning – do go through the wordings of the health insurance plans carefully before choosing a company to stick to. Understand the points related to pre-existing diseases, coverage undertaken, what constitutes as hospitalization and medical expenses, pre and post hospitalization expenses, and the likes. A little effort and a miniscule investment into your own self would go a long way. After all, doctors say that there is, literally, no adult human who is completely healthy, and you wouldn’t want life to hit you while you don’t have your boxing gloves on!

Neha Gadoo
Written by Neha Gadoo
Daring and Bold, Neha loves philosophy, trekking and walking bare feet in the rain. Loves talking and can stare out of a car window for hours continuously.