Today on the show, we'll cover health insurance and new guidelines by IRDA to make the process more transparent for you.
We'll also tell you what really works to get the best medical cover - individual mediclaim or a family floater.
It's really easy to buy insurance isn’t it? Agents from all across the town will call you and make great sales pitches. Whether it is a car insurance or medical or a life insurance, you can even buy them online now. And you do buy them and you pay premiums regularly hoping, you're covered well for the tough times. But come emergency - medical or a road accident and you realise it's not that easy to get a claim or sometime even better - you may get the claim but when you go back to the insurance company for the policy renewal, they may refuse to renew your policy on really thin and flimsy grounds. This was one of the biggest areas of consumer complaints, especially with mediclaims. Now the good news is, IRDA, the regulatory body for all insurance in India, has come out with new guidelines for all health insurance companies to protect you as a consumer.
BIG NEWS: New IRDA Guidelines for Health Insurance Companies
A health insurance company cannot refuse to renew policy, except in cases of fraud, which means a wrongful claim has been made to dupe the insurance company.
Just because you have been hospitalised for an illness, and when you go back for renewal the Insuring company cannot force you to move to another plan. They will have to renew the one you already have.
A lot of insurers are very unclear in their document about renewable dates and options. Now, those Disclosures will have to be made upfront. Also, right now,1 to 2 day delay in paying your premium and kaboom! There goes your medical insurance policy. They simply refuse to renew it. Now, they will have to give a 15 days grace period to renew policy. These new IRDA standards come into effect from June 1st.
Sometimes a policy relapses because you were late by 3 days. You get no reminder from the agent and when you call him up, his excuse is, there were many holidays that week and he was out of town! But, the same guy was happy calling us 5 times a day to sign up. This is the other problem in insurance - the agents lose interest the minute you sign that cheque.
# You can tag premium paying dates to important events like birthdays or say before Christmas or before the summer holidays.
# You can work with a company that is good with their systems. I Pru, for example, will SMS and email customers to remind them of their premium paying dates about ten days in advance.
# But of course, the regulator can help and in this case IRDA has taken a proactive step forward.
# One of the biggest areas of dispute between insurance companies and policy holders has been in dealing with pre-existing diseases. Now all companies will have to insure pre-existing diseases after 5 years of holding the policy, though what exactly is pre-existing, IRDA yet has to define.
You cannot be refused a renewal on your mediclaim policy from June 1. There were instances of cover being refused if a large claim had been paid out or the age of the policy holder went above a certain threshold. A company can now refuse renewal only if there has been a case of fraud.
We all know that a mediclaim policy means the hospital bills will get paid. But there is lots more to know so that we maximise this insurance:
# A 30 day waiting period for claim on a new policy
# Rs 5 lakh cap on most covers
# Sub limits on room rent and procedure expenses
# 24 hour hospitalisation rule gets waived for eye surgery, dialysis, kidney stone removal
# Expenses 30 days before and 60 days after are part of the pay-out
# Exclusions - dental, pregnancy, OPD, alternative medicine, psychiatric disorders, cosmetic surgery
# Pre-existing diseases don't get immediate cover, but only after 5 claim free years
We always flesh out the best and the cheapest option for you in any kind of insurance, but in medical insurance that does not always work. Your medical history is perhaps more critical. But the one question we need to understand is that - do individual medical covers for each member of the family work out better or a family floater of a larger cover works out better.
And now, here's a number glimpse of how individual mediclaim for each member plus a top-up works out the best - both from a cheaper premium point of view and the benefits you enjoy. For this example, we've taken a family of 4 aged 45, 40, 15 and 12 and a cover of Rs 5 lakh per annum.
Royal Sundaram Health shield - we recommend that you take individual cover of Rs 2 lakhs rupees each, plus a super top up for the family of Rs 3 lakh. Premium works out to Rs 10,415, while taking individual mediclaim of Rs 5 lakh each works out to Rs 17436.
The next best combo deal comes from United India Insurance. Rs 11831 for the combo of individual and top up and 19851 rupees for 4 individual covers. Next best is IFFCO Tokio. Rs 12082 for the individual plus top up combo of 5 lakh cover and over 20,000 for individual alone.
So go ahead and take the combo option any day to max both benefits and cover at the cheapest price.
And now, a quick reminder of our key takeaway from this week on health insurance - go for individual mediclaims for each member of the family and combine it with a Super top up policy from United India to get the best benefits and then pray you don’t really need to use it, because you'll work hard and keep in good shape!