5 Things to look at while choosing a Health Insurance
Health Insurance is one of the most crucial instruments that one can have. The inflation in the health care space is increasing at a rate of over 15% per year compounded. Medical costs are one of the prime reasons where people face a major liquidity drain. The need for a health insurance policy cannot be undermined. There is a dearth of companies offering various options in the health insurance space. However clients often get confused on what to buy and how to choose a policy. This post aims at helping you identify the right product for you. So that you can take a informed choice.
1.) Network Hospitalization:- Always look if the insurance company has a wide enough network hospital base. Network hospitals are those hospitals where the insurance company is empanelled with. Cashless facilities work only in such associated hospitals. Hospitals which are not network hospitals do not accept cashless claims and in such cases the client has to pay the bills and then get the same reimbursed. Hence insurance companies having a better network hospital base will always give the client a wider choice of cashless facility treatment.
2.) Capping:- Till the last decade a lot of companies used to cap the amount of coverage provided to a lot of diseases. They had amounts specified unto which a cover was provided irrespective of the bill amount. This has changed a lot in the last 10 years however one must still look at the finer print to ensure if the policy is not capping the amount of coverage to specified diseases. Example: public sector insurance providers had a capping of Rs 16000 for kidney stone irrespective of actual bill amount also many of the companies still have a capping on room rent of hospitals. example: 1% of sum insured shall be the amount payable on the room rent during hospitalization.
Hence take into consideration the amount of capping while picking a health insurance policy.
3.) Claim Settlement Ratio:- Claim settlement ratio is the ratio of claims settled per 100 claims. This ratio depicts the frequency of claims a company gives out and the percentage of claims which the company rejects. A high claim settlement ratio indicates that the company passes claims and the probability of one's claim being rejected is low. It is preferred to choose companies having a claim settlement ratio of over 90%.
4.) Premium to Cover ratio:- Many people fall for companies providing cheaper premiums. However unless the above three mentioned points are evaluated, the premium must not be looked at. One must not have the misconception that the cheapest premium providing company is the best, however it does not also mean that a policy is good because it is expensive. One must look at the features and comprehensiveness and then find a balance between the premium and coverage provided.
5.) Riders and Features:- "Customer is King" in the current market scenario, hence a lot of companies keep providing additional features and riders to create an impact in the market. Hence the client must ensure that features like automatic restoration, critical illness riders, permanent disability riders, guaranteed sum insured increment etc are included in the policy.
These may be just some of the points which need to be considered while choosing a health insurance policy. However these are critical points which cannot be neglected. Hope this article gives you a framework in making the right choice while picking a health insurance policy . Happy investing.