Why should you supplement your indemnity cover ‘mediclaim’ with defined cover ‘critical illness’ cover?

We all are at health risk, due to our hectic lifestyles and environment. This is why we equip ourselves, with a health insurance policy. It is the need for financial security, and quality treatment, which convinced us to buy a health risk cover. We know treatment expense in India is skyrocketing now. Even if we suffer from seasonal diseases like dengue or chikungunya, it will cost a lot, if we just consider our hospitalisation expense.

 

 

But, is your health insurance cover enough? If you have an insurance coverage amount of Rs 10 lakhs for self, is it still enough? We are asking these questions, as this is the right time to reconsider our options. Healthcare in India is making rapid advances, and we should avail maximum benefit of our health insurance cover. We should not be in a ‘compromising’ situation, even when we have a mediclaim policy.

 

Over the past few years, there has been a rise in the number of critical ailment cases. The sad part is that even youngsters are becoming susceptible to these critical diseases, like cancer, heart attack, etc. While critical ailments require specialised medical care, a mediclaim policy has a cap on doctor’s fees, and thus, you won’t get the complete coverage. In such cases, you will have no option but to pay from your pocket. Further, acute illness also means loss of income, disability, and change in lifestyle. Therefore, it is necessary to consider a critical illness (CI) cover.

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What is CI cover?

 

CI covers life-threatening conditions under a single insurance policy. Life-threatening risks can be heart attack, stroke, heart surgery, paralysis, organ transplant, kidney transplant, cancer, among others. Under CI cover, the policy beneficiary is entitled to receive the total insurance coverage amount in a lump sum. It is applicable from the time when the insured is diagnosed with a life-threatening condition.

 

How will you benefit?

 

This can be best explained with an illustration. Rahul is a 35 year old married man. His wife Anjali is 30 years old. They have a 2 year-old child. Rahul is living with his father, who is 55-years old.

 

Policy holder and coverCI cover benefits
Rahul has a policy for selfRahul is a busy man, with a hectic lifestyle. As Rahul grows older, he is at high risk of developing life threatening conditions, for example heart disease due to his sedentary lifestyle. If he has a family history of heart disease like his father has suffered a heart attack earlier, then he is at a greater risk. His warning signs will be high cholesterol, high BP, diabetes . He should have a CI cover.

 

If he suffers from chest pain at 38 years, then consider this:

 

His consultation fees to hospital will be Rs 800 onwards. This is not covered in his hospital package expense covered under standard health insurance policy.

 

Total cost of his treatment will be much higher. If he requires a stent, it will cost him Rs 3-5 lakh. The conservative estimate for his hospital stay will be Rs 10,000/day in a good private hospital.

 

His expense (15 days hospital admission) will look like:

Rs 800x 6= 4,800

Rs 5 lakh

Rs 10,000×15= 1,50, 000

Medicine, post treatment expense, doctor consultation should be added.

 

Rahul is likely to incur close to Rs 15 lakh for his treatment. It’s a life-long disease.

 

Standard policy will not cover this huge amount.

 

Exact benefits of CI cover (of Rs 30 lakh) will include-

ü  Payment of Rs 30 lakh when Rahul is diagnosed with a health problem

ü  Even if Rahul does not need a heart surgery, he is entitled to the whole amount

ü  Rs 30 lakh will cover his whole treatment expense and recuperation aids as well

 

A standard insurance policy will not include-

ý  Lump sum Payment of Rs 30 lakh. It is very unlikely that Rahul will have Rs 30 lakh as insurance coverage for self. At max, he might have Rs 12-15 lakh

ý  Even then, only his hospitalisation expense will be covered, which will be less than his actual treatment cost

 

Who requires a CI cover?

 

Two new reports by the Indian Council of Medical Research estimate that the number of cancer patients will increase to 1.7 million by 2020.

 

Taking the above illustration forward, Rahul will require a CI cover in addition, if

  • Rahul is planning to have a second child. His wife is 30-years old, has a family history of breast cancer, then he requires it on priority
  • Rahul is growing older. He has a family history of heart risk
  • Rahul’s father is an old-age man, and at increased health risk. He should necessarily have a CI cover, considering his father’s exact health condition now

 

 

Consider the following before buying a CI cover

 

Exact coverage offered by your insurance company; more specifically the list of diseases covered.

Opt for long policy tenure, to enjoy lifelong benefit. You never know when bad health strikes you. You should be financially prepared at any time in life. Also, opt for a large insurance coverage amount. Consider, inflation costs, since this is a long-term cover.

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