What is Add-on Cover in Health Insurance in India?

You have bought a standard health insurance plan and are comforted by the fact that all your health-related expenses are covered from this point of time. However, there are certain requirements that a standard health insurance plan does not cover.

What about them, then? 😟

Here is where health insurance riders come into the picture! 🙂

If you already hold a health insurance policy, it is highly likely that you have heard the terms add-ons or riders. It is now time to know the details of health insurance add on covers and what are their benefits. 

A rider or add-on is an additional benefit or coverage that is not included in a health insurance policy's existing features and must be added separately in exchange for an additional premium. 

Health insurance add-ons or riders can be taken on and above your existing health insurance policy to enhance its benefits or sum insured in health insurance to be availed on account of pre-determined events.

According to the Insurance Regulatory and Development Authority of India (IRDAI), the collective premium for all riders or add-ons availed under a single health insurance policy cannot exceed 30% of the original premium amount.

Let us understand this statement with the help of an example:

For instance, you avail a family floater health insurance policy at Rs. 5000 per annum premium for a sum insured of Rs. 700000. You also decide to include 5 add-ons to your health insurance policy. In that case, the additional premium you will need to pay for those add-ons cannot exceed Rs. 1500 (5000 x 30%) as per regulations mentioned by IRDAI.

Do you need to opt for every add-on or rider offered under a health insurance policy? 🧐

Definitely not!

Adding every rider to your health insurance policy just because it is safe will be very expensive. Hence, it is wiser to assess the insured individual’s existing medical conditions, family’s medical history, lifestyle, etc., to decide which add-ons would be suitable for such an individual before opting for them. 

Here are the types of Add-ons or riders in health insurance policies you can choose from:

1. Room Rent Waiver

In a standard health insurance policy, hospital room rents are capped to a certain limit. When you include a room rent waiver add-on to such health insurance policies, it either increases that limit, or no-limit is imposed.

In the case of no cap, room rent is allowed to the extent of the sum insured. It is a crucial health insurance rider if you are hospitalised in a metropolitan city, where hospital room rents are considerably higher.

Let's understand with an example how room rent waiver add-on cover works: 

Consider your standard health insurance policy caps the room rent limit at Rs. 1500 per night. You find it inadequate to meet room rent expenses in hospitals where you would prefer to be admitted. Hence, you take the room rent waiver add-on and increase such sub-limit to Rs. 4000 per night. 

2. Maternity Cover

With a maternity cover, you receive coverage for all expenses related to pregnancy and childbirth. Some insurance companies also provide coverage for the child’s expenses either up to the policy’s maturity period or up to 3 months from the child’s birth under maternity cover.

Additionally, depending on your policy, the cover also compensates for expenses arising out of fertility issues and the newborn baby’s hospitalization charges due to any medical complications and vaccination charges, up to 90 days from the date of delivery.

3. Daily Hospital Cash Cover

Under this health insurance rider, you are provided with daily cash allowance by the insurer for the period during which you are hospitalised. The insured individual must be hospitalised for more than 24 hours or 1 day to receive the allowance.

It is provided to compensate for the loss of pay during hospitalisation and can be utilised to meet necessary expenses like that of conveyance, food, etc.

4. Critical Illness Cover

Under this add-on, insurance companies provide a lump-sum amount to the insured when diagnosed with any critical illness, irrespective of the cumulative treatment expenses.

Suppose, you have availed a health insurance policy with a sum insured of Rs. 5 lakh. You also decide to avail a critical illness cover add-on which offers a sum assured up to Rs. 15 lakh.

In case you are diagnosed with cancer and you raise a claim with the insurance company, it will immediately pay out a lump sum of Rs. 15 lakh even though your total treatment costs stand at Rs. 9.5 lakh.

5. Personal Accident Cover

This add-on provides financial coverage on account of accidental damages suffered by the insured individual. It includes partial disability, permanent disability, death, etc.

In case of death, due to an accident, the insured individual’s family receives a lump-sum amount under this add-on. 

6. Zone Upgrade Cover

With a zone upgrade, you can avail higher financial coverage for treatments at different city zones. Zones are classified as per the city’s medical expenses. The higher the medical expense in a particular region, the higher it is placed in such classification.

This add-on allows you to account for the disparity in treatment costs across different regions or zones with a slightly higher premium. But subsequently allows you to save on your total premium by 10%-20%.

7. Consumable Cover

The consumables include various non-medical essential costs that policyholders incur while in the hospital but are not otherwise covered by the policy. 

For example, basic health insurance policies do not cover the cost of oxygen masks, gloves, syringes, needles, PPE kits, cotton, bandages, gowns, etc.

A list of 199 items that are "non-payable" from the insurer's point of view was first published in 2012 and reviewed by the Insurance Regulatory and Development Authority of India (IRDAI) in 2016. The list serves as a guideline, and insurers can include or reject any or all items from this list regarding policy coverage.

8. Day Care Procedures

Daycare treatment strictly refers to treatments, surgeries and operations that require hospitalization for less than 24 hours due to advancements in medical technologies and procedures.

These include treatments like cataract surgeries, chemotherapy, radiation therapy, dialysis, hysterectomy, and arthroscopic knee aspirations, among many other procedures.

9. OPD Cover

As part of any medical treatment, a person may have to pay for OPD consultations, diagnostics, and prescription drugs. These can add up to a significant sum, affecting one's finances. 

As a result, OPD treatment is an optional benefit that the policyholders can claim from their insurance companies if they have this add-on. Subject to the terms and conditions of the policy, coverage is offered up to a predetermined limit.

Health insurance is essential, but a basic policy may not always cover all your needs. That’s where Digit Health Insurance add-on covers come in, offering extra protection beyond the standard plan. 🤩 

Investing in these covers means you’re not just insured, and you’re well-covered in every situation. Here are some reasons why you must consider having Digit’s Add-on. 

To Sum Up

Health insurance isn’t just about having a policy; it’s about having the right coverage when you need it the most. Add-on covers act as a safety net within your safety net, ensuring that you’re fully protected without unexpected financial burdens. 

Instead of settling for the basics, why not customize your plan to match your lifestyle and health needs? After all, true peace of mind comes when you know your insurance is as flexible and protective as you want.