What is Health Insurance?

Health insurance provides financial coverage to an insured person against medical and surgical costs that occur from accidents, illnesses, or injuries. It either pays the insured person's care provider directly or reimburses the expenses incurred due to illness or injury.

An individual can avail of such a policy against monthly or annual premium payments for a specified tenure. During this period, if an insured has an accident or is diagnosed with a severe illness, the insurance provider bears the expenses incurred for treatment.

The workings of health insurance policies in India are easy to understand. The insurance company covers the policyholder's medical costs up to the predetermined sum insured in health insurance, and the policyholder pays a premium for coverage.

Here is how a health insurance policy works in India:

• You can choose a plan based on coverage needs, including in-patient hospitalization, pre/post-hospitalization expenses, and specific illnesses.
• After purchasing the policy, you have to pay a premium, either annually or in instalments, which depends on factors like age, health status, coverage amount, and chosen benefits.
• Every policy has a certain waiting period in health insurance, which means you cannot benefit from the policy for this duration.
• In case of hospitalisation, your insurance company will cover the cost of the incurred medical expenses.
• You can claim the expenses in two ways:
  • Cashless Claim: Treatment costs are covered directly by the insurer at network hospitals.
  • Reimbursement Claim: The policyholder (you) must pay first and then submit the bills to get the reimbursement.
• And here is the good news: For years without claims, insurers offer bonuses on your policy.

What do these statistics signify? These are the possible medical complications individuals might develop during their lifetime and the corresponding expenses for treatment of the same.

These staggering figures and rising medical expenses demonstrate the importance of health insurance policies in India. These policies offer comprehensive coverage of healthcare expenses against periodic premium payments made by the policyholders.

Nobody thinks of having health insurance before we truly need it. However, knowing all the benefits is crucial to buying a health insurance policy! Here are some:

1. Hospitalisation Expenses:

Any medical condition requiring urgent hospitalisation is covered under health insurance plans. However, claims are only entertained if the disease has not been previously diagnosed when the insurance plan was not availed of.

Renowned insurance providers also extend hospitalisation expenses incurred under the following situations:

• Treatment Against Critical Illness - Some insurance providers extend substantial amounts equal to or greater than the sum insured to cover all underlying expenses to treat critical diseases. This includes the cost of hospitalisation, diagnosis and medication, etc.
• Accident and Illness-Related Hospitalisation Coverage - Medical expenses borne in the course of hospitalisation due to illnesses or accidental injuries also come under this category. Major insurance providers offer comprehensive treatment charges up to or higher than the sum insured.

2. Pre and Post Hospitalisation Charges:

A health insurance plan can cover pre and post-hospitalisation expenses. Pre-hospitalization expenses include diagnosis expenses, doctors’ fees, medications, etc. 

Most insurance companies also reimburse post-release expenses such as medication, routine check-ups, injections, etc.

3. No Room Rent Cap on ICU Room Charges:

There is no room rent cap on the type of bed you choose. Health insurance policies also cover ICU bed charges. An insured individual can also choose to stay in a private room, the costs of which can be billed against the respective insurance provider up to a total insured amount.

4. Cover Against Mental Illness:

Hospitalisation in due course for mental treatment is also covered under such health insurance policies. With rising rates of mental health issues in India and globally, this facility allows individuals to seek professional help for a well-rounded life.

5. Daycare Procedures:

Expenses incurred for daycare treatment at hospitals, such as dialysis, cataract, tonsillectomy, etc. are covered under most health insurance plans.

6. Road Ambulance Charges:

A standard health insurance policy covers any road ambulance expenses incurred during times of medical emergency. This poses a significant benefit as premium hospitals often charge substantial amounts for transportation.

7. Refill Sum Insured:

Under such a health insurance policy, you can make claims amounting to the sum insured twice a year, provided the medical conditions differ each time.

8. No Claim Bonus:

For every non-claim year, insured individuals are extended discounts or a higher sum insured (at no additional cost) in the succeeding years, which can help to reduce their premium charges payable annually or to extend their sum insured coverage.

9. Daily Hospital Cash Cover:

Daily cash allowance is provided by stipulated institutions, enabling individuals to make up for the loss of pay during times of hospitalisation.

10. Zero or No Co-payment:

Insurance companies cover all medical bills generated during an insured individual's treatment procedure up to the sum insured. Zero co-payment supports a patient financially, allowing him/her to focus solely on recovery.

11. Zone Upgrade Facility:

In India, treatment costs usually vary from one city to the other. It is especially higher in metropolitan cities like Delhi and Mumbai. 

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

 *Currently, at Digit, we have no Zone Upgrade Add-on. However, you will get an additional discount on the premium if you are based in Zone B.

12. Domiciliary Care:

Comprehensive health insurance policies cover all expenses incurred for home hospitalisation expenses. This includes medication, nurse fees, injections, etc., payable for a patient's comprehensive treatment.

Health insurance is often misunderstood! Many say it is only for the elderly, while others say it only covers medical bills. Both are far from the real truth. Here are some common myths with facts check to help you make smarter decisions regarding your health.

#Myth1 - Young people don't need health insurance

Well, there is no guarantee that an accident or illness won't occur, even if you are fit and fine. Therefore, getting a good health insurance policy is a good idea for everyone, regardless of age or health status.

#Myth 2 - My health insurance will cover all my expenses

Every health insurance plan has a list of exclusions and limitations as per IRDAI regulations. It is recommended that you review all of the policy information and the coverage that your insurance provides.

#Myth 3 - You can get instant coverage after buying

Not all the time. There may be a waiting period for certain health insurance plans. Only once the waiting time has passed are some illnesses covered. Read about your specific policy waiting period.

#Myth 4 - Online health insurance plans are fraud

Seeing people holding onto this myth in the current digital era is disheartening. Online health insurance is highly popular and safe. When you buy a health insurance plan online, you might get some of the greatest and most affordable offers.

#Myth 5 - I do not need to discuss my pre-existing disease with my insurer

When purchasing health insurance coverage, it is crucial to disclose your pre-existing conditions. Insufficient details or failure to disclose pre-existing conditions may result in the claim being denied and the policy being cancelled.

#Myth 6 - People who smoke and drink are not covered under health insurance

Some health insurance providers provide coverage to smokers & drinkers. Given the hazards, smokers and drinkers would have to pay a higher premium and go through a rigorous pre-medical screening to obtain health insurance coverage.