With breakthroughs and advancement in medical science, life expectancy has increased in India. Life expectancy at birth was around 40 years in 1967; in 2016 it was 68.56 years. As people live longer they require continuous medical care which increases the cost-burden on the family. With medical breakthroughs, diseases that were fatal in the past can be combated and lives can be saved but it results in expensive medical bills.
If you are married and your parents have retired, you also have to factor in the healthcare costs of your children and parents. Hospitalization expenses arising out of an injury or treatment costs for a single critical illness can easily wipe out your savings.
Therefore, it’s extremely important to have a family health insurance plan to secure your family’s health and protect yourself from a financial hazard. Today insurers have designed highly innovative and customized health plans and products to meet various medical expenses of the individual or family. One of them is the option to buy a health top up to increase your coverage.
What is a health insurance top up?
A top-up health policy provides additional coverage if your medical or hospitalization bill crosses the sum assured amount of your base plan. Experts recommend that if you are living in an urban area, you need a minimum coverage of Rs. 10 lakh in your family health policy.
If you take into account inflation at 10%, major treatments that cost an average of Rs. 5-6 lakh will cost a minimum of Rs. 10 lakh in 8 years and Rs. 20 lakh in 15 years. If you have an existing health plan with coverage of Rs. 5 lakh, you can increase it to 10-15 lakh with a health top up to preparing for increasing medical costs in the future. A top up plan also provides a host of health insurance benefits in addition to your basic health policy.
But why a health insurance add on cover? Why not buy a family health plan with Rs. 10 lakh coverage instead?
The reason is cost. If you buy a family floater of Rs. 10 lakh, it will cost you more than buying a top up plan with a deductible of Rs. 5 lakh. On the other hand, you can buy Bajaj Allianz Extra Care Plus health insurance top up available on Bajaj Finserv MARKETS with coverage options that range from Rs. 3 Lakh– Rs. 50 Lakh with premiums as low as Rs. 2500 per annum.
But what’s a deductible? Let’s understand that with an example.
What’s a deductible in health insurance top up?
It’s very important to understand the concept of deductibles before you buy a health top up. The deductible amount determines when the benefit of the top-up will start for your policy. For example, if the deductible limit for your top up policy is Rs.5 lakh, then you must have already spent Rs.5 lakh from your existing insurance policy or out of your own pocket (if you don’t have a health plan). Only then the top up policy will trigger and the insurer will provide cover for the remaining Rs. 5 lakh that have been spent.
When is the right time to buy a health insurance top-up?
As you and other family members grow older, health insurance plans become more expensive. You can keep premium costs in check while enhancing the cover with a top-up. This method is highly cost-effective compared to increasing the coverage in your existing policy or buying a new health insurance plan.
It is advisable to have an existing health plan before buying a top up. Without a medical insurance policy, you will have to pay the money (deductible amount) entirely out of your pocket before the top up is activated. You must consider a health plan top up as a way to counteract inflation and the rising costs of providing medical care to your family. Note that your health insurance top up and basic health plan don’t have to come from the same insurer. You can buy a top up from a different insurers and it still remains applicable.
With Bajaj Allianz Extra Care Plus top-ups available on Bajaj Finserv MARKETS you can increase coverage for an individual policy or a family floater policy at a minimum cost and get access to more than 6,000 empanelled hospitals across India.
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