5 health insurance mistakes you should avoid

Contrary to popular perception, health insurance is rarely expensive and claims are usually paid by the insurers

People often don’t purchase health insurance, which, with term insurance, should be among the top two covers to have. A recent survey by Future Generali India Insurance of 1,082 people highlights some mistakes people commit.

A look at the findings and remedial action:

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Not purchasing health insurance
The survey found people across age groups don’t like to buy health insurance, though 27 per cent said one person in their family had been diagnosed with a critical illness. Treatment for cancer can cost Rs 5-30 lakh. Medical annual inflation is usually 15 per cent or above. “A medical emergency may well arise when you are young and have not yet built up an adequate corpus. Having health insurance ensures quality health care,” says Arvind Laddha, chief executive, Vantage Insurance Brokers. Thinking health insurance is costly
As many as 52 per cent of the people surveyed had not bought health insurance, citing high premium costs. But for a family of three, where the oldest member is 35, the cost of a Rs 5-lakh cover is Rs 7,577-10,388 (plus service tax). At Rs 20-30 a day, it isn’t exorbitant.

Buy a base mediclaim policy, plus a top-up
Buy a base mediclaim policy, and go for a top-up. For two adults aged 40, who have a base policy of Rs 5 lakh, a top-up of Rs 15 lakh would be Rs 6,588-9,504.

Believing insurers don’t pay claims
As many as 15-35 per cent of respondents across age groups said they hadn’t bought a health cover because they had heard insurance companies don’t pay claims. “Companies turn down claims only if fraudulent or if there was misrepresentation at the time of buying the policy,” says Laddha.

Ensure the information offered at the time of purchase is complete and true. Says Deepak Mendiratta, managing director, HII Insurance Broking Services: “Ask the people at the insurance desk at a neighbourhood hospital which companies accept claims with minimum fuss.”

Not renewing health cover
As many as 19-30 per cent of the people across age groups had owned a policy but did not renew it. According to Manoj Aswani, operating chief, Myinsuranceclub.com, “Mostly people who have never experienced a claim miss out on renewals. Those who have experienced a claim treat it as priority.” Allowing your policy to lapse has many disadvantages. Says Shreeraj Deshpande, head of health insurance, Future General India Insurance, “Renewal allows you to earn credit towards the waiver of time-bound exclusions. It also helps you earn a cumulative bonus for each claim-free year.” All exclusions and waiting periods will apply to you if you buy a new policy.

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