Buying health insurance for yourself and your family is one of your most important decisions. Hence, it is essential to understand your health insurance coverage needs, the policy you will be buying, and its features and benefits. To ensure you choose the best policy for your family from the available options, you must consider some key factors while comparing health insurance plans. In this article, we will discuss some of these key factors.
Your health insurance requirements
The first step in buying health insurance is understanding your family's requirements. You need to evaluate the following:
- The number of people you will include in the policy
- The amount of insurance coverage that will be adequate
- The overall and specific features that you want in the policy. For example, if someone in the family has diabetes, you will need to look for a policy that covers diabetes either from day 1 or the shortest possible waiting period.
- The premium amount that you are willing to pay
Evaluating the insurance companies
Before you compare health insurance plans of various companies, you need to research the health insurance companies. You can evaluate the companies on the following parameters:
- Network of hospitals: The bigger the hospital network of the health insurance company, the better. ManipalCigna Health Insurance has a wide network of 8500+ hospitals. Check whether the hospitals in your area are covered in the network. If you have a preference for any specific hospital, check whether it is covered in the network.
- Claim settlement process and time taken: Check the time the insurance company takes to approve cashless treatment authorisation. The sooner the company approves, the better. Check the claim settlement process. It should be smooth, convenient, and easy to follow for anyone. Lastly, check the data for claims received and paid by the company annually and the time taken to pay the claim. You can get this information from the IRDAI Annual Report. For example, in 2021-22, ManipalCigna Health Insurance Company paid 99.90% of the claims within 3 months.
- List of day care procedures: The higher the number of day care procedures covered by the insurance company, the better.
- Solvency ratio: In simple terms, the solvency ratio indicates how good or bad the insurance company's financial strength is. It is an important indicator for assessing the ability of the insurance company to pay claims. The IRDAI mandates a minimum solvency ratio of 150%. You can check the solvency ratio of the insurance company from the IRDAI Annual Report. The higher the solvency ratio is beyond 150%, the better.
- Overall track record: You can check the overall track record of the insurance company with regard to the range of products offered, time taken to issue policy and service claims, resolving any queries related to policy servicing, etc. You can check the rating, reviews, etc., of the company.
Why Comparing Health Insurance Plans Is Important
You are clear about your health insurance requirements and have evaluated insurance companies. Now it is time to compare the health insurance plans of various companies. You may consider the following key factors for comparing health insurance plans.
Avoiding Underinsurance and Overpayment
Before jumping into the detailed factors, it’s important to understand the balance every policyholder must strike. Many people either end up underinsured- exposed to high out-of-pocket costs- or overpay for features they don’t need. The idea is to select a plan that has coverage that is consistent with your real-life risks, family size, and budget.
Underinsurance usually happens when you pick a low sum insured just to save on premiums. Overpayment occurs when you purchase unnecessary add-ons or a very high coverage amount, even though your medical usage is unlikely to justify it.
A smart comparison will keep you out of either, and you will get the complete protection at the appropriate price.
Factor 1: Coverage and Sum Insured
Coverage and sum insured form the heart of any health insurance plan. The coverage defines what the policy protects you from- hospitalisation, daycare treatments, pre- and post-hospitalisation expenses, ambulance charges, domiciliary care, AYUSH treatments, and more. The sum insured determines the maximum claim you can make in a policy year.
A lower premium might look attractive, but a plan with insufficient coverage can leave you paying heavy bills during emergencies. Conversely, having a very large sum insured without adequate utilisation can be a waste of your budget.
Evaluating Coverage Based on Family Needs
Each family has individual healthcare requirements. The amount insured that would be sufficient for a young couple might not be sufficient for a family with elderly parents. The following are some of the guidelines to consider what is appropriate to you:
1. Family Size and Age Mix
- A moderate amount insured (₹5 - ₹10 lakh) can be a starting point in young families that have no pre-existing conditions.
- Families that have elderly people or young children might need greater coverage because they have greater medical risks.
- Multi-generation families should take into account schemes that have coverage of 15-25 lakh or family floaters of high value.
2. Lifestyle and Health Risks
Individuals who have a sedentary occupation, inherited risk, or chronic conditions are advised to choose higher coverage. Such lifestyle disorders as diabetes, hypertension, and cardiac problems usually demand costly treatments.
3. City of Residence
There is a high difference in healthcare costs:
- Tier-1 cities (Mumbai, Delhi, Bengaluru): A higher sum insured is required because hospitalisation costs are higher.
- Tier-2 Cities and Tier-3 Cities: A moderate coverage can be used, but it is always a good idea to future-proof.
4. Inflation Protection
In India, medical inflation is between 12 and 14 per cent every year. A strategy that might seem sufficient today might be inadequate in a couple of years. A high sum insured option or selection of plans that have sum-insured restoration and annual increase options will help with long-term affordability.
Factor 2: Premiums and Co-Payment Clauses
Premium is usually the initial aspect that individuals compare, yet it cannot be used alone as the deciding factor. A low premium can be a sign of less coverage, increased deductibles, a limit on the amount of room rented, or an increase in co-payment provisions.
Co-payment implies that you have to pay a percentage of the cost of treatment with your own money. An example of this is a 20% co-payment on a 2 lakh bill, which will see you pay 40,000.
Balancing Affordability and Coverage
To strike the right balance:
1. Understand the Premium-to-Coverage Ratio
The good plan is one in which the premium is reasonable when compared to:
- Sum insured offered
- Number of benefits included
- Coverage for modern treatments
- Cost flexibility in hospitalisation.
2. Avoid Plans with Heavy Co-Paying
Plans with high co-payment percentages might appear budget-friendly but result in higher expenses during claims. It’s ideal to choose plans with:
- No co-payment, if possible
- Low co-pay percentages only if you’re consciously budgeting your premium
3. Check If Premiums Increase with Age or Claims
Look for:
- Stability of premiums over the years
- No-claim bonus (NCB) benefits
- Long-term premium discounts
A plan that rewards you for staying healthy adds more value in the long run.
Factor 3: Network Hospitals and Claim Settlement Ratio
A large network of hospitals ensures cashless treatment- meaning you don’t pay upfront during emergencies. The claim settlement ratio (CSR) reflects how efficiently an insurer settles claims.
Both factors heavily impact your experience during medical emergencies.
What to Check While Comparing Plans
1. Breadth of Network Hospitals
Look for:
- Availability of top hospitals in your city
- Nearby emergency hospitals
- Speciality hospitals for elderly family members
- Coverage for daycare and super-speciality procedures
A wider network means faster and smoother cashless approvals.
2. Claim Settlement Process
Check:
- Claim settlement ratio over the last 3–5 years
- Average claim approval time
- In-house claim management teams for quick processing
Plans with strong CSR and transparent claim processes are always preferable.
Factor 4: Add-Ons and Riders
Add-ons, also known as riders, allow you to customise your health plan. They strengthen your base policy by offering additional protection against specific risks.
Top Riders to Consider When Comparing Plans
1. Critical Illness Rider
Offers a lump-sum payout if diagnosed with a covered critical illness like cancer, stroke, or kidney failure.
2. Hospital Cash Rider
Provides daily cash allowance to manage expenses not covered under base insurance, such as travel, meals, and special assistance.
3. Personal Accident Cover
Covers accidental death, permanent disability, and partial disability.
4. Maternity and Newborn Cover
Useful for young couples planning to start a family.
5. OPD Cover
Reimburses consultations, diagnostics, and minor treatment that do not involve hospitalisation.
Although riders increase protection, they raise the premium. You should therefore select only the ones that are suitable for your family's healthcare requirements.
Factors 5 & 6: Waiting Periods and Exclusions
All health insurance policies are associated with some restrictions, primarily waiting periods and exclusions. These dictate which claims can be made instantly and those that have to wait.
1. Waiting Periods
Most policies have:
- Initial waiting period (30 days) – no claims except accidents
- Pre-existing disease waiting period (2–4 years)
- Specific treatment waiting periods for hernias, cataracts, joint replacements, etc.
A plan with shorter PED waiting periods offers faster coverage.
2. Exclusions
Exclusions are conditions or treatments not covered under the policy, such as:
- Cosmetic treatments
- Infertility treatments
- Dental or vision (unless add-ons are chosen)
- Certain advanced treatments
Comparing exclusions helps you understand the real scope of protection.
Compare health insurance plans and choose one that fits your requirements
We have discussed six key factors to consider while comparing health insurance plans. There are additional factors that can be compared.
ManipalCigna Health Insurance (MCHI) offers a wide range of health insurance plans under various categories. These categories include hospitalisation cover, personal accident cover, critical illness cover, daily hospital cash, and riders (that can be optionally attached). Within categories, MCHI has various plans and different variants within some plans. You can compare various plans on the product comparison page. On a specific product page, if the product offers variants, you can compare the features of the variants.
The comparison process may take some time, but it will help you identify the plan that best suits your needs. When you have bought a health insurance plan that fits your requirements, it will give you much-needed peace of mind.
Conclusion
One of the most significant financial decisions that you will make is the selection of a health insurance plan. Considering variables such as coverage, premium, network hospitals, riders, wait times, and exclusions, you will be able to choose a plan that actually fits the healthcare requirements of your family.
The correct policy ensures your financial stability in the long run, peace of mind, and safeguards against unexpected medical expenses. Rather than being purely about the premium, strive to have a plan that gives a maximum value, flexibility, and reliable coverage in times of healthcare crisis.
FAQs
-
What are the top things to check when comparing health plans?
The important items to consider include coverage, sum insured, premiums, co-payment terms, network hospitals, claim settlement ratio, waiting periods, exclusions, and riders. These are the factors that guarantee you the appropriate protection without having any hidden surprises.
-
Should I prioritise premium or coverage?
The coverage should be first. A moderate premium on all-inclusive cover is preferable to a low premium cover that under-insures you. Select a middle ground that will not only fit your budgetary limit, but will also provide you with protection against the high medical expenses.
-
How do riders enhance a base health plan?
The riders will provide additional protection by addressing certain requirements, such as critical illness, personal accidents, maternity benefits, or OPD cover. They enable the personalisation of your plan, so that it is more specific to your family lifestyle and medical risks.
