Health insurance sublimit: A crucial factor for policyholders

Sub-limits are decided by the insurance company and the most you can do is thoroughly understand the sub-limits of a policy before making a purchase

Health insurance is an important safeguard against the rising costs of medical care. But do you read all the policy-related details before taking the policy?

 

Many policyholders discover a lesser-known aspect of their coverage much later. It is called the health insurance sublimit.

What is the health insurance sublimit? 

Sublimit is a pre determined cap on specific medical expenses within a health insurance policy. They can be expressed as fixed amounts or as a percentage of the total sum insured. For instance, you have a health insurance policy with a sum insured of Rs 5 lakh, and there is a sublimit of Rs 20,000 on certain medical procedures defined in your policy. Now, at the time of claim settlement of the mentioned medical procedure with sublimit, assuming your medical bill comes out to be Rs 1 lakh. In that case, in spite of a larger sum insured amount available, the insurer will only pay claim for Rs 20,000 while the remaining Rs 80,000 will be borne by the policyholder. 

Common sub limits on health insurance policies include:

Room rent: This is one of the most common types of sub-limits. Policies often specify a maximum daily room rent that the insurer will cover. 

 

ICU charges: Usually limited to twice the room rent sublimit.

 

Doctor’s fees: May be restricted to a certain percentage of the sum insured or a fixed amount per day.

 

Specific treatments: Certain procedures like cataract surgery or knee replacement may have predefined limits.

 

Ambulance charges: Some plans also have caps on ambulance fees, which can add to the overall medical expenses if not adequately covered

Sublimits are meant to balance the coverage & premium costs for both the policyholders and insurers. While choosing the right health insurance for your needs, it’s essential to consider sublimits and get a clear understanding of it for further integration in your policy, said Ajay Shah, Head – Distribution, Care Health Insurance.

Factors to consider when choosing a health insurance plan with sublimits: 

Type of sublimits: Understand the specific sublimits imposed by the policy. These may apply to room rent, specific treatments, or pre-and post-hospitalisation expenses.

 

Cost of the plan: Don’t just focus on the premium. Consider additional costs like co-payments, deductibles, and coinsurance. 

Network hospitals: Verify if your preferred hospitals are within the insurer’s network. Treatment at out-of-network hospitals might result in higher costs, potentially exceeding the sub-limits.

Waiting period: Check the waiting periods associated with certain treatments and how sub-limits apply during this time. Some sub-limits might not be relevant until after the waiting period is over.

Renewal policy: Ensure the policy is renewable and understand any changes in sub-limits upon renewal. Also, check whether you can increase the sum insured at renewal or if there are restrictions.

 

Claims process: Check the ease and speed of the claims process. A cumbersome process can cause significant stress during emergencies, so it’s important that filing a claim is straightforward and quick.