Health insurance or medical insurance plans protect you against financial losses when you have a health condition or medical emergencies such as a disease, illness, or accident. It covers you for expenses incurred during pre and post-hospitalization, annual health checkups, psychiatric support, critical illnesses, maternity-related expenses, etc. as detailed in your customized health insurance plan.
A top-up health insurance plan offers additional health insurance coverage on a per claim basis, allowing you to avail of the sum insured under this plan when the claim amount is more than the sum insured in the base health insurance plan.
Thus, medical insurance policies aim to offer financial aid against expensive medical bills and curtail liability. But what happens when the coverage under the existing plan gets exhausted?
In such cases, individuals can obtain top-up health insurance plans and enjoy extended coverage.
Some insurers offer super top-up health insurance plans that cover total hospital bills above the deductible amount up to a specific limit. Considering the rising medical costs, it is practical to opt for insurance top-ups once an individual crosses the threshold limit. It offers additional coverage and a host of other benefits.
Here are some factors you should consider before buying a top-up health insurance plan.
5 important things to know before you buy a top-up health insurance plan
Although a top-up health insurance plan offers additional financial backup, choosing such a policy can become difficult for some people. To make this easier, consider the following pointers to help you make an informed decision.
1. What are the benefits?
As a policyholder, you must check whether the benefits under a top-up plan cover all your specific requirements. Make sure the top-up covers essential treatment procedures. As purchasing a top-up health insurance policy means paying higher premiums and extending coverage, it is vital to check the inclusions. If the policy does not cover such medical procedures, there’s no point in purchasing one.
2. What about deductibles
A deductible is a certain percentage of the claim amount that an insured person must pay before the provider settles the rest. Like some insurance plans, top-up plans also come with a deductible clause. However, such a clause becomes active when the medical expenses surpass the deductible limit.
Generally, the tendency is to go for a higher deductible plan to pay lower premiums. But, in the case of top-up plans, this concept does not work as policyholders need to pay a substantial claim amount from their own pockets. So, it is practical to choose a deductible limit close to the base medical insurance plan’s sum insured.
However, remember that individuals with two claim amounts cannot enjoy coverage under a top-up plan if the claim amounts have not crossed the deductible limit. Therefore, obtaining a super top-up health insurance plan in such a scenario is wise as it considers aggregate claims in a policy year.
3. What is the coverage?
The coverage of a top-up insurance plan depends on several factors like the medical history of family members, residing city, and the current insurance type. One can choose a coverage plan for parents and other relatives based on family medical history. Additionally, individual and family floater medical insurance policyholders can opt for top-up plans.
4. What about cover for pre-existing illnesses?
Some mediclaim policies might not come with pre-existing ailment cover. In that case, policyholders must go for a top-up plan against additional premium amounts and get coverage against pre-existing diseases running in the family. However, such a plan has a waiting period.
5. Are there any restrictions?
A top-up health insurance plan comes with various restrictions, such as sub-limits. This feature restricts the coverage available in a policy. Additionally, a top-up policy may be subject to sub-limits on specific surgeries, room rent, etc. So, before purchasing a top-up policy, one should ensure it has minimal or no sub-limits.
Moreover, a co-payment clause in top-up health insurance is also a sub-limit. It is practical to opt for a plan that comes with a minimum co-payment.
In closing, one can say that top-up policies are an excellent way to cover medical costs if a policyholder exhausts the coverage under an existing policy. One might also want to check the pointers above for maximum benefits on top-up insurance.