The Basics Of Health Insurance

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A health policy has become more important now than ever, owing to our drastic lifestyle changes. 30 is the new 60 when it comes to health. Considering this paradigm shift, it is important to have a cushion. A medical insurance bought in good time serves as the perfect back up. When purchased early, it comes at a lower premium, lesser waiting time, and a host of other benefits.

 

When you go to buy a Health Insurance plan, medical insurance, or mediclaim, the terms the agents use can be incredibly intimidating. So why wait for that discussion with friends and family? This guide will help you through those conversations and heavy matter that you need to read through as you finalize your insurance policy.

To begin with, health insurance, medical insurance, and mediclaim are all the same thing. It is nothing but an insurance plan that protects you financially against medical emergencies. Depending on the plans you buy, the insurance can cover hospitalization as well as pre and/or post hospitalization expenses.

An Insight Into The Indian Scenario

The IRDA or Insurance Regulatory and Development Authority is the sole regulator of the insurance sector in India (1). If you are looking to buy medical insurance, you will have to pay a premium on the policy. In the event you incur hospitalization expenses, you could make a claim to the health insurance companies.

A few standard policies cover everything right from the ambulance charges to those incurred in the operation theater. But then, there are also other special policies that are more accurate for your family’s needs. The family medical insurance policy is usually a floater health plan that covers all the family members under a single policy. While this policy entails fund flexibility, it is possible that one member alone could exhaust the cover, leaving no amount for the others. So you must weigh your options before you invest.

Now that you know the basics of a medical policy, it’s time for you to get acquainted with some commonly used terms.

A Peek Into The Insurance Lingo

Here is a list of a few words that are commonly used in insurance parlance. This will help you understand what you are getting into.

1. Reimbursement Claims

Under these claims, you pay up the hospitalization expenses upfront. Eventually, you need to submit relevant proof like bills, doctor’s certificates, etc. and claim the amount from the insurance company.

2. Cashless Claims

These claims will allow you to avail treatment at a list of approved hospitals (by the insurance company) without having to pay any money to the hospital. In these instances, the insurance company settles the amount with the hospital. If you have picked such a policy, you will be given a health card that you need to show at the hospital.

3. Third Party Administrator (TPA)

A TPA is hired by an insurance company to process all claims.

4. Sub-limit

This limit usually refers to the maximum limit on a certain amount that can be claimed for that particular ailment. The sub-limit depends on the policy you buy – you can choose to either raise these limits or waive them off entirely.

5. Exclusions

The diseases that are not covered under the health insurance plan are called exclusions. Cosmetic surgery is usually excluded from health insurance.

6. Deductible

A deductible is usually the amount of loss borne by the policyholder. When the deductible is high, you pay lesser premium.

Always remember, a health insurance policy is an investment. It will minimize your financial burden when you are struck with medical emergencies. Do not forget to make an informed decision, though. We are sure this article will help you with the technicalities.

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