In case you are planning to get health insurance for yourself or your family members, it is important to understand the insurance terminology while going through the policy quotes and making informed choices. Doing so can help you understand what you will be provided with in times of need and how you must make use of it.
This blog simplifies some of the most common health insurance terms you’ll ever hear. If you are just looking at various insurance policies, an understanding of the terminology can help you find the best insurance according to your requirements.
Key Health Insurance Terms You Should Know
Health insurance policies contain typical terms that might be new to you if you’re a beginner when it comes to insurance. Let’s demystify the common terms:
1. Sum Insured
Sum insured is the highest financial coverage provided by the insurance company during the policy year. It is the maximum amount up to which the medical expenses will be paid. For instance, if your sum insured is ₹10 lakhs, all eligible hospitalisation expenses up to this point will be paid.
2. Pre-existing Diseases
Pre-existing illnesses refer to health conditions that you might have when taking the policy. Such illnesses may involve long-term conditions such as diabetes, hypertension or heart illnesses. Most health insurance plans impose a waiting period on pre-existing conditions, and the coverage only becomes active after a stipulated period.
3. Waiting Period
It is the duration when you can’t access your health insurance, and have to wait to reap the benefits of the policy. The waiting period differs based on the nature of the condition or benefit. For instance, maternity benefits may come with a two-year waiting period, while other pre-existing diseases might have different waiting periods.
4. Co-payment
Co-payment will require that you pay a fixed percentage of the medical bill to the insurance company. Suppose you have a policy with a 10% co-payment rule, and your hospital bill is ₹1 lakh, you would pay ₹10,000, and the insurance company will pay the remaining amount.
5. Network Hospitals
These are hospitals that have tie-ups with the insurer to provide a cashless facility. Upon admission to a network hospital, your bill is paid directly by the insurer as per policy conditions. HDFC ERGO provides access to more than 15,000 network hospitals spread across India to ensure hassle-free treatment without making any advance payments.
6. Deductibles
A deductible refers to the level of the cost of medical care you are prepared to pay before the insurer steps in. A higher deductible policy may be less expensive, but it requires more out-of-pocket expenses in treatment.
Common Benefits and Policy Features to Understand
Knowing some policy features allows you to better decide on how extensive your medical insurance actually is. These terms also determine your level of coverage and subsequent renewal benefits.
1. Day Care Procedures
Medical technology has made various treatments and surgeries possible within 24 hours. Daycare procedures are treatments that are included in most contemporary health insurance policies without involving hospitalisation for more than a day.
2. Lifetime Renewability
Most insurance policies, including HDFC ERGO insurance policies, are lifetime renewable. This means that if you buy health insurance, it can be renewed annually without any age cap if you make premium payments on time.
3. Cashless Treatment
This advantage enables you to get medical treatment without paying out of your pocket at the time of treatment, as long as the hospital is within the insurer’s network. The claim is paid directly between the hospital and the insurance company, thereby making emergency treatment accessible.
The Role of Add-on Covers in Enabling More Protection
A number of health insurance policies provide add-on benefits, referred to as riders or add-on covers. These serve to add to your coverage beyond the bare essentials of the policy features.
1. Critical Illness Cover
This policy makes a one-time premium at diagnosis of some life-threatening diseases such as cancer, kidney failure, or stroke. It is paid to offset expensive treatments typically associated with terminal illness.
2. No-Claim Bonus (NCB)
If you do not claim in a policy year, you become liable for a no-claim bonus. It normally results in an increase in the quantum of sum insured without an extra premium. It is a common feature of most of the best health insurance policies offered by leading insurers.
Conclusion
It becomes easier to select a plan according to your health and monetary needs with proper knowledge of health insurance terms. If you are in search of similar covers or examining your present cover, knowledge of these terms allows you to make the correct decisions.
For those who want to invest in insurance with specific benefits and adequate coverage, HDFC ERGO offers different health insurance covers for individuals and families. Their policies integrate core features and added benefits, enabling you to be safe from increasing medical expenses with confidence.
The post Common Health Insurance Terminology Defined for Beginners appeared first on Trade Brains.