Do's and Don'ts of Health Insurance Policies

Finding and purchasing health insurance plans can be a tricky matter if you are unaware of what goes into it. In our second podcast of the financial vaccination series, Mahavir Chopra, founder and CEO of Beshak.org, informs on some of the simple do's and don'ts when buying, renewing and filing claims on a health insurance policy.

As a product that covers your medical expenses, health insurance is crucial and a must. Some policies also offer you the benefit of covering preventive care, but not all policies cover 100% of your costs. Mahavir Chopra breaks down the jargon and evaluates the fine print you need to consider when looking into health plans. Let's look at the list of do's and don'ts he offers.

List of Do's 

• Look for adequate coverage. When you buy a health plan, aim for coverage covering expenses after you cross 50 or 60 years. Remember not to purchase coverage that is applicable to your current age, but rather a coverage amount that could apply to your old age. 
• Check for financial limitations. An ideal must be free from significant restrictions in terms of coverage scope. For example, look for a policy with no cap on room rent or a specific kind of surgery/treatment. 
• Be aware of all exclusions. Look for temporary and permanent exclusions and get a detailed understanding of the policy. Request your insurance agent to provide you with a thorough understanding of what is excluded in the policy or request the insurer to offer you precise details.
• Offer clarity on existing conditions. Remember to be open when and offer all information as required by the insurer. Being honest about your health offers your insurer an insight into your risk and profile to recommend an ideal premium pricing. If the insurer is kept in the dark about any health conditions, it may be not easy to file a claim and could negatively impact your policy in the future. 
• Find out about medical tests. Most insurers offer preventable medical check-ups for free as an annual service for adult members of the family. Evaluate the health insurance plan based on whether the company is offering you a free medical check-up. Medical check-ups required for investigation purposes consists of two subcategories: 
   
  • Leading to hospitalization - A health insurance plan typically covers this test that diagnoses a particular health condition.
  • Do not require hospitalization - The outcome of these tests that can be treated with medication may not be covered by the plan.
     
• Check for cost-benefit analysis. When evaluating coverage, conduct fundamental cost-benefit research—understand if the coverage for medical expenses is adequate for the policy premium you would have to pay. If the analysis is beneficial to you, it can be a good idea to go for the plan. 
• Learn more about co-payment clauses. There are two reasons why an insurance provider adds a co-payment clause. One is to make the premium more affordable, and the other could be to ensure that there are controls over the claims. Typically, a customer opting for the co-payment clause means being on a financial partnership with an insurance company whenever there is a claim. Go for a policy without a co-payment clause or with a lesser co-payment to reduce your out-of-pocket expenses.
• Examine if all family members are covered. At the time of restoring your policy, add any new family member to the plan.
• Review the coverage. You may want to upgrade the coverage to keep up with the times by buying additional coverage on the same plan or purchasing a super top-up. You could consider extension policy from the same insurer or another insurance provider.
• Understand portability. If you are looking to move to another insurer, you could opt for portability. This means you could move to a new health insurance plan offered by another insurance provider that includes all existing policy benefits into the new one.
  
   

List of Don'ts 

• Don't hide any information from your health insurance provider. An insurer is in the business of paying claims. They minutely look into any discrepancies that could hamper your policy if undisclosed when buying the policy.
• Don't delay renewing your insurance. An annual policy that needs to be renewed every year must not be missed. Generally, you may be provided with a grace period after the policy renewal date to renew the policy. If you fail to revive the policy after the grace period, all benefits would be lost, and the policy could lapse. 
  
   

Choose the Right Plan with the Right Coverage

Choose the right plan that makes sense for you and your family. Look for a reputable insurance agent who puts your needs first and avoids conflicts of interest to help you navigate the buying journey and offer you unbiased advice. Investing a little time to know more can help you choose the right type of health insurance for your needs.