Health Insurance Top Up Benefits

Benefits of a Health Insurance Top-Up

Health insurance policies are indispensable to protect you and your family against high, and often unaffordable, treatment costs in case of medical emergencies. But what happens when treatment costs exceed your insurance cover? You may have to dip into your savings, or you could land in debt. Here’s where a top-up plan can come to your rescue.

 

Over your base cover, you can purchase health insurance top-up for a nominal rate to ensure you don’t have to pay for the extra medical expenses later on. 

The top-up plan will kick in after the threshold limit, called the deductible, has been crossed. Here, the deductible is an amount that the policyholder has to pay either out of their own pocket or through their base insurance policy cover. After the healthcare costs exceed the threshold limit, the top-up plan will come into effect and cover the expenses up to the plan’s insured limit. So, let’s look at the benefits offered by health insurance top-up plans.

Advantages of Opting for Health Insurance Top-Up

• Cost-Effective Option

Getting a top-up plan is an inexpensive method of upgrading your health insurance cover. Suppose you have an insurance policy to secure the medical needs of your dependents, but you feel that it won’t be enough to cover a big health emergency. Instead of buying a new health insurance policy that will charge a higher premium based on your age, a top-up plan is a more lucrative option.

The top-up plan shall offer an affordable premium to safeguard your loved ones when the time comes. It is also the best alternative in case you cannot upgrade the sum insured of your existing health plan and have reached the maximum limit. Therefore, health insurance top-ups are a great way to get a higher cover at low costs.

• Easy to Purchase

Top-up plans are super easy to access due to the advancements in technology. They are available to buy from a wide variety of insurers without any restrictions. And with a large number of insurance providers offering top-ups, you can compare the plans available in the market and choose the best option for you.

Something you should keep in mind is that you can opt for a top-up plan from any insurer and not necessarily your existing insurance provider. But it is recommended to learn the terms and conditions of doing so to avoid any hassles in the future!

• Increased Coverage

There is a misconception that top-up plans are similar to riders that provide additional or add-on benefits to the main insurance policy. However, these plans function as indemnity policies, the same as your other health insurance plans. They come with similar benefits and reimbursement options and exist independently of your base health cover.

The only difference is that they will kick in once the expenses in a single incident exceed the threshold limit. If the deductible of your plan is ₹5 lakh, then the top-up will only cover expenses exceeding ₹5 lakh, up to the insured limit, in a single incidence of hospitalisation. Moreover, the higher the deductible, the cheaper your top-up policy will be. However, it is advised to get sufficient coverage without the premium being the only deciding factor.

• Safeguards Against Rising Healthcare Costs

The healthcare inflation in India saw a steady increase during the FY19, which was 7.14% in 2018-19. It has been rising at double the rate of the overall retail inflation where currently the healthcare inflation is 7.7% in June 2021. Such numbers stress the importance of having sufficient medical coverage to avoid dipping into your life savings.

Top-up plans enable you to get the much-needed security against the soaring medical costs in the country! With the cashless facility and increased sum insured, you can be worry-free when it comes to health emergencies.

• Tax Benefits

Like your base insurance policy, top-up plans are also eligible for health insurance tax benefits. The premiums you pay on the top-up plan can be claimed under Section 80D of the Income Tax Act, 1961.

If you pay premiums for a health policy along with a top-up plan, covering yourself, your children and your spouse, you can claim a combined deduction of ₹25,000 on your premium payments annually.

You can claim an additional ₹25,000 as a tax deduction if you are also paying premiums to provide insurance cover to your parents. In case your parents are senior citizens, you can claim a deduction of ₹50,000. With this, you can enjoy insurance coverage as well as save money on taxes without any trouble!

To Conclude

It is always recommended to review your health insurance cover before renewal and understand if any upgrades are needed. The risks of being underinsured with the healthcare costs increasing steadily are greater than you can imagine! Thus, a top-up plan is a lucrative and affordable way to ensure your loved ones have enough backup.

So, head over to Bajaj Markets and opt for a health insurance top-up plan to put your medical needs first!

Health Insurance Plans Available at Bajaj Markets