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Studies reveal that in spite of growing inflation rates clubbed with upsurge in healthcare costs, 70% of Indians are yet to opt for any sort of insurance cover protecting them against hospitalization expenses.
It’s shocking to know that in a fast developing country like India, people are still being ignorant about the need to plan for a suitable arrangement to tackle any financial emergencies arising out of an accident or sudden illnesses.
The most economical manner of being prepared for medical emergencies and protecting your savings is through a mediclaim insurance policy. It looks after clinical prices following hospitalisation on illness or accident or even for any surgery required. The payments are taken care of through either a cashless treatment facility or repayment mode offered by means of the insurance company.
Mediclaim insurance plans reimburse your costs on submission of applicable proofs like clinical bills. Alternatively, it may make you eligible for a wholly cashless hospitalization in which your insurer acts as the intermediary between your insurance provider and the concerned hospital. You can declare your insurance with the insurance provider to
Mediclaim policy comes to your rescue in case you are hospitalized due to an accident or any ailment. It covers you for nursing, lodging and treatment costs up to the coverage amount that you choose while buying the policy. Most mediclaim policies also cover the treatment sought before and after hospitalization, related to the reason or ailment you were hospitalized for. This time frame depends on the insurers and typically ranges from 30 to 60 days before hospitalization and between 60 and 120 days after hospitalization.
The rapidly increasing cost of medical and healthcare, one of the reasons being rising inflation rates, emphasises on the importance of a mediclaim policy. Another reason that is making healthcare increasingly expensive is the growing rate of lifestyle-driven health issues.
Sudden health emergencies are sure to leave a hole in your pocket, unless you prepare for it well in advance. A mediclaim insurance policy offers a lump sum health cover, which is the sum insured, when you need it the most. Mediclaim policies in India are available for a specific tenure as offered by insurance companies. These policies can be renewed to avail continued benefits.
In simple terms, mediclaim policy comes to your rescue in case you are hospitalized due to an accident or any ailment. It covers you for nursing, lodging and treatment costs up to the coverage amount you choose while buying the policy. Most mediclaim policies also cover the treatment sought before and after hospitalization related to the reason/ailment you were hospitalized for. This time frame depends on the insurers and typically ranges between 30 days before and 60-120 days after hospitalization.
Checks 3 Reasons Before Buying a Mediclaim Policy
Here are three things that you have to consider while buying an effective mediclaim plan that meets your unique needs.
Choose a sum insured which takes care of the growing inflation in the medical sector and at the same time is economical and within your budget. An ideal plan must have features like coverage for a vast number of illnesses, procedures, etc. It should be free of room rent limits, co-payments and sub-limits. The plan should also have life-time renewals because it is the old age when health insurance is needed the most. Also take into consideration the waiting period for the coverage of any pre-existing illnesses, the lower the waiting period, the better it is. You must also read the exclusions carefully so that you do not get a rude shock in the time of need.
Incurred Claim ratio refers to the percentage of total claims made that were approved by an insurance company. This ratio is determined on the basis of factors like age of the business portfolio, business mix, etc. As this data and figures are not directly divulged to customers, it becomes difficult for buyers of mediclaim policies to understand how this ratio is finalized. Industry experts report that the incurred claim ratio for group mediclaim policies is higher than individual policies. An incurred claim ratio of at least 85% is considered to be an indicator of an effective mediclaim policy. The incurred claim ratio is the total claims settled by an insurance company as compared to the premium that it had collected in a particular year. Check for the latest ‘Handbook of Indian Insurance Statistics’ to become aware of the current incurred claim ration of insurers, so that you can take a well-informed decision.
Ensure that the mediclaim enlists a few hospitals that you usually visit, are accessible to you, have the standard medical facilities, etc. For instance, if you would prefer cashless payments over reimbursements, ensure that the mediclaim that you select includes some network hospitalization that will offer you this facility in the event of hospitalization.
The three important factors which determine mediclaim policy eligibility are:
Age: Your age is the most important factor which determines your mediclaim policy eligibility. The standard entry age preference is 91 days to 65 years, but many insurers accept different age groups depending on the policy offered. Also, since you are more likely to undergo medical treatment due to aging, it is advisable to buy a policy at the earliest possible.
Premium: The premium depends on the age, sum insured chosen, type of mediclaim policy, no. of members included in the plan and lifestyle habits of a person. If you smoke cigarettes or consume alcohol, the premium is likely to be higher.
Medical Check-ups: At a young age, not all insurers request for a medical report to be submitted. For 45 years and above, insurers make it mandatory to take a medical check-up.
The sky-rocketing hospitalization and related healthcare costs might burn a hole in your pockets. It proves to be even more challenging when the expenses arise from unforeseen circumstances like hospitalization due to accidents and critical illnesses. Mediclaim policies serve as financial security, enabling individuals to be prepared for all eventualities. Considering the extensive range of benefits that you reap on these policies as compared to the reasonable premium payments, mediclaim policies are a smart investment option. Along with the financial cushion that it guarantees, the peace of mind that it offers makes it totally worth it. Well, the answer is simple. Anyone who cannot possibly afford those sky rocketing hospitalization and related healthcare costs should definitely invest in a good mediclaim insurance. Considering the premiums you pay each year, the benefits you reap are much valuable. Along with a financial cushion to reckon, the peace of mind it offers makes it totally worth. Documents Required to Buy a Mediclaim Policy
The key features of a mediclaim policy are:
Benefits covered by a mediclaim may vary depending on the insurance company. These are the common benefits covered by mediclaim policies:
Benefits covered by a mediclaim may vary depending on the insurance company. These are the common benefits covered by mediclaim policies:
Hospital expenses – Expenses incurred due to hospitalization like medicines, oxygen, blood, OT charges, medical tests and diagnosis, chemotherapy, radiotherapy, organ transplantation, etc.
Hospital accommodation expenses – Expenditures towards ICUs are either addressed through cashless hospitalisation feature or are reimbursed by the company.
Day-care hospitalization – Expenditures towards tech-driven medical treatments that do not involve 24-hour hospitalization.
Pre and post-hospitalization expenses – Expenses incurred for up to 30-60 days before and till 60-120 days after hospitalization. It may also include medical assistance for emergency services like ambulance, etc.
Charges for medical experts – The fees for medical professionals involved during hospitalization like doctor, nurse, etc. are also provided by mediclaim policies.
Types of mediclaim policies can be broadly classified under two categories:
Note: The coverage offered, applicable age limits, sum insured and premium vary across policies and insurers. The information mentioned below is of a basic plan common across insurers.
Only the policyholder is insured against the financial liabilities of hospitalization.
| Coverage | Individual, can range from Rs. 1 lakh to 50 lakhs |
| Age | |
| Sum Insured | Rs. 1 lakh to 50 lakhs or more |
| Premium | Premiums paid for mediclaim policies differ from one insurer to another. Factors which determine premiums are Age, sum insured, policy benefits, etc |
| Coverage | Family Floater Basis, can range from Rs. 2 lakhs to Rs. 1 crore |
| Age | |
| Sum Insured | |
| Premium | Premiums differ from one insurer to another. Factors which determine premium are age, sum insured, members covered, etc. |
| Coverage | Senior citizens, Some plans offer the option to cover both lives (you and your spouse) up to 90 years of age or lifetime |
| Age | 60 years to 80 years |
| Sum Insured | Rs. 1 lakhs to Rs. 25 lakhs |
| Premium | Premiums paid for mediclaim policies differ from one insurer to another. Factors which determine premium are age, sum insured, policy benefits, etc. |
The Family Floater plan is highly recommended because it covers hospital expenditures for all your family members who have been included in the policy document. It includes spouse, parents and children. Opting for individual health insurance policies for every family member would require you to pay premium for each one of them separately. As opposed to this, a Family Floater will cover your entire family on the payment of one premium, proving to be a reasonable yet effective investment.
However, you need to keep in mind that a mediclaim cannot be considered to be an effective substitute for a health insurance policy. This is because a mediclaim reimburses hospital and other related expenditures. Therefore, it is best to look for a health plan that offers the right combination of features and benefits, along with simplified claim settlement and cost-effective premium payments.
The following are the differences between a Health Insurance and Mediclaim Policy:
Type of cover: Health insurance policies are comprehensive, that is, it not only covers for your hospitalization expenses, but also includes pre and post-hospitalization expenses. On the other hand, mediclaim policies cover hospitalization expenses towards an accident or certain critical illnesses on certain terms and conditions, as specified in the policy document of insurance companies.
Critical Illness Mediclaim benefits: Health insurance plans provide covers on critical illnesses, as an inbuilt rider or add-on rider, on more than 30+ diseases, as specified in their policy documents. Some of the critical illnesses usually covered are:
In contrast, mediclaim policies do not cover critical illness and other hospitalization expenses. Also, the types of critical illness that will be covered solely depend on the discretion of your insurance company.
Insurance companies consider a lot of factors while determining the premiums for the mediclaim policy. Age, sum insured, geographical location, any pre-existing medical condition, number of members to be insured, the extent of coverage, etc. are some of them. While the guidelines are set by IRDAI, health insurance companies take the final decision regarding premium calculation on the basis of your needs and requirements. The more comprehensive your requirements are, the higher will be the premiums to be shelled out.
Insurance companies have their own unique list of parameters that they consider while calculating premium. Here are some parameters that are generally considered by all insurance companies.
Premium is the amount that the policyholder pays towards the insurance policy to become eligible for its benefits, as per the policy document.
You can avail the cashless benefits of a mediclaim policy only in the network of hospitals that is mentioned in your policy document. Undertake a thorough check of the network hospitals in your policy document and go through the websites of the insurance company and its network of hospitals, before making a final choice. This greatly reduces the scope for claim rejections later.
You may not be eligible to utilise the cashless benefits of your policy in any hospital other than those enlisted in your policy document. Therefore, before you make a claim against your mediclaim policy, ensure the expenses have been incurred in a hospital or chain of hospital that is a part of the network of your insurance company. You will mostly be able to avail the reimbursement facility at a recognized hospital of your insurer.
Getting admitted in a hospital that is not a part of the network of hospitals of your insurance company or an unrecognized hospital may reduce your chances of being eligible for claiming your settlement on hospital and other related expenses, but does not completely disqualify you from it. You may not be able to able avail cashless facilities, but you might be eligible for reimbursements from your insurance company. However, you have to be consistent with the premium payments on your mediclaim policy, keep the policy active and strictly follow the terms and conditions to avoid claim rejections.
After you have initiated a claim settlement on hospitalization, your insurer has to approve your request for cashless hospitalization. This process is referred to as authorization. It can take up to 24-72 hours for your insurance company to verify and approve your claim. Pre-planned hospitalization due to medical conditions and health concerns like surgeries will require pre-authorization before you get hospitalized. For emergency hospitalizations, prior authorization is not needed and would not get your claim rejected.
Below are some of the best mediclaim policies in India:
Investing in mediclaim is a great decision. Consider all the factors involved and accordingly choose the right policy. Below are some of the aspects you need to keep an eye on before purchasing the policy:
Sum insured (coverage amount): While choosing the sum insured or the coverage amount, it’s advised to consider factors like rising healthcare costs, rate of inflation, etc. to choose the right amount. Also, if you are living in one of the metro cities, your cost of hospitalization will be higher compared to rural areas. Similarly, if you are opting for the coverage of your dependants too, you might want to consider higher sum insured.
Individual or Family Floater: This decision entirely depends on you. If you are unmarried and looking to cover only yourself then you can opt for the individual policy. However, if you choose to cover your entire family including your parents then selecting a family floater plan is the ideal choice. Family floater plans are also a bit easier on pocket compared to individual policies bought for each family member due to the discounts offered by the insurance companies.
Sub-limit on Room Rent: Most mediclaim plans are tailor-made with room rent sub-limit. These limits might vary depending on the insurance companies. To make it simpler, let’s explain with an illustration. Mr. Kulkarni bought a plan that had room rent sub-limit as 1% of the sum insured. He had chosen the coverage for Rs. 2 Lakh. That means, every time Mr. Kulkarni wants to claim hospitalization on his mediclaim, the insurance company will compensate his expenses limited to the room rent of 1% of his sum insured i.e. Rs. 2,000 per day. The entire calculation of his claim disbursement will be carried out as per his room rent limit even if he opts for a room higher than the limit of Rs. 2,000. Hence, it’s wise to choose the policy with proper room rent limit to avoid any rude shocks during claim settlement.
Co-payment: Many mediclaim policies are in-built with co-payment clause. Co-payment is basically a percentage amount that the policy holder needs to bear when the claim is raised before the insurance company settles the rest. These co-payments can range anywhere between 10% and 30% depending on the insurance company. For example: If you have opted for a mediclaim with 20% co-payment, whenever you raise a claim, you’ll have to bear the first 20% of the total claim amount and the rest will be compensated by the insurance company as per the terms and conditions of the policy. Some insurance companies also offer to cover the risks related to pre-existing diseases with higher co-payments.
Exclusions: Every mediclaim policy is designed to cover your medical risks. However, there are certain exclusions that are either not covered or covered after a specific term. Conditions arising out of a suicide attempt, HIV infection, congenital diseases, addiction to alcohol or drugs, etc. are not covered by any policy whereas expenses related to maternity, hysterectomy, gall bladder surgeries, kidney stones removal, etc. are covered after a specific waiting period. Most insurance companies cover the risks related to any pre-existing diseases only after 3-4 years. Details of these exclusions are mentioned in the policy wordings of the plan and one should definitely go through the same before finalizing to buy.
Hospital Network: One of the biggest benefits of opting for a mediclaim policy is the convenience of cashless settlement of hospitalization expenses. Every insurance company has a network of hospitals and when you seek hospitalization in any of these hospitals, you are entitled for a cashless treatment if the hospitalization/treatment is within the scope of coverage. This works out to be a great financial relief at most crucial times. Hence, check out and be aware of the hospitals in your area that is in tie-up with the insurance company you wish to buy the plan from.
Reputation of the Insurance Company: Last but not the least, it’s always wise to check the credibility and market standing of the insurance company you wish to buy the mediclaim from. Apart from this, a little study of their claim settlement ratio will also prove to be useful while making the final decision.
The claim process of a mediclaim policy has become increasingly more streamlined and quick, owing to the integration of advanced technology. The settlement process follows either of these two methods – cash reimbursement or cashless claims.
If you opt for the reimbursement option during claim settlement, this is the process that is usually followed:
Cashless claims: To initiate this process, you have to fill up the Preauthorization Request Form and submit it to your insurance company through the network hospital. Cashless planned hospitalization: If your hospitalization is pre-planned, it is necessary for you to submit the completed Preauthorization Request Form at least 72 hours before your hospitalization. This enables the insurer to ensure a seamless and hassle-free claim settlement. Cashless emergency hospitalization: In case of an emergency hospitalization arising due to an accident or critical illness, you are usually expected to present your mediclaim ID at the network hospital to enable admission to the hospital. Post that, you need to submit the completed Preauthorization Request Form within 4 hours to initiate the claim settlement process. This implies that it is mandatory for you to keep your mediclaim ID handy with you always.
For a Death Claim:
Medical Natural Death:
Accidental Unnatural Death:
Frequently Asked Questions
Q. How to choose a Best Mediclaim Policy?
Ans: You need to keep the following parameters in mind while selecting a suitable mediclaim policy:
Premiums – The payments made towards Mediclaim policies differ between insurance companies, based on various parameters like age of the applicant, location, policy tenure, sum insured on maturity of the policy tenure, etc.
Age – Suitable for individuals right from the age of 91 days to 65 years, though the terms and conditions regarding age vary between insurance companies.
Cover for family – The unique option of one master premium enables you to ensure mediclaim for your entire family. Not just that, such a facility often makes you eligible for additional benefits and discounts on premium, based on the insurance company and policy you have opted for.
Overseas mediclaim policies – Some mediclaim policies also cover you for emergencies that might occur when you are abroad, based on certain terms and conditions.
Claims – While some insurance companies channel their claims through Third Party Administrators (TPAs), some others process claims in-house.
Types – There are a wide range of mediclaim policies offered, which we will discuss later in the article.
Tax benefits – Mediclaim insurance premium are eligible for tax deduction under Section 80D of the Income Tax Act, 1961, Premiums up to Rs.25,000 on mediclaim premiums for self, spouse and dependent children. An additional tax exemption of up to Rs.25,000 is applicable on insuring parents and extends to up to Rs.50,000 for parents who are senior citizens.
Q. What are the things to look for while choosing a health insurance plan?
Ans: While choosing a health insurance policy there are a few things which you should be ready with are:
Number of members and relations to be covered- Because this will be the basis of buying policy.
Type of coverage – Individual, Family floater or group.
Sum insured or coverage amount – Ensure that you consider future expenses too.
Room rent – Check for the capping amount or criteria defined if applicable.
Sub-limits or co-pay applicable – Check for the sub-limits applicable for some specific list of ailments or package treatments. Also check if the plan has co-pay feature.
Network hospital list – Check for the list of network hospitals and try buying a policy which covers your regular hospital.
Policy wording – Most important thing to check before buying a policy is the policy wording. In case you are not sure about certain term or condition you can always contact the insurer for clarification.
Q. Which mediclaim policy covers pregnancy in India?
Ans: Some mediclaim policies that cover pregnancy in India are:
Q. Can I cancel my mediclaim policy and if yes will I get my premium back?
Ans: Yes you can cancel a policy after you buy it. A free look period of 15 days is provided to you after buying a policy to understand the terms and conditions. In case there is any objectionable clause, you can cancel the policy and get a refund. Stamp duty, expenses on medical check-up and proportionate risk premium (the number of days that the insurance company was at a risk of bearing your health expenses) would be calculated while the premium amount is refunded. Refer the policy termination or policy cancellation section in your policy wording to know the amount that would be refunded.
Note: For the refund to happen there should be no claim during the policy period.
Q. What is mediclaim policy for employees?
Ans: Group mediclaim policies are specifically designed for employers, who can opt for it for their employees on the payment of pre-determined premiums. This policy enables employers to cover their employees on specific hospitalization and other related expenses, as defined in the policy document of the insurance company. Employees can also avail tax benefits under such policies.
Q. What are the types of cashless mediclaim?
Ans: The following are the two types of cashless claims in mediclaim:
Cashless claims: Fill up the Preauthorization Request Form with accurate information and submit it to your insurance company to initiate the claim settlement process.
Cashless planned hospitalization: In the case of pre-planned hospitalization, you need to submit the completed Preauthorization Request Form at least 72 hours before your hospitalization. This enables the insurer to ensure a streamlined and seamless claim settlement.
Cashless emergency hospitalization: For emergency hospitalization as a result of accident or critical illness, you are expected to present your mediclaim ID at the network hospital during admission. Further, the completed Preauthorization Request Form can be submitted within 4 hours of hospitalization to initiate the claim settlement process. Hence, it is essential for you to carry your mediclaim ID with you at all times.
Q. How Can Coverfox Help You Choose the Right Mediclaim Policy?
Ans: Here’s how Coverfox simplifies the process of selecting a suitable mediclaim policy.
