Health insurance is supposed to provide peace of mind. For an individual, when a family member becomes ill, their health insurance is expected to cover hospitalisation expenses. However, it has been observed that many individuals are dissatisfied when they receive lower claims than expected. Generally, this occurs due to certain coverage limits. These limits determine your final claims.
Coverage limits refer to terms in an individual’s health insurance policy. These determine how much of your medical expenses will be paid. Even if the covered sum appears large in your insurance policy, terms within the policy limit the extent of what will be paid for claims. This is why two people with similar insurance coverage may receive different amounts for their claims.
A sub-limit refers to a smaller limit that has been set within your overall health cover. For example, your health cover may provide a medical cover of ₹10 lakhs. However, this may also specify a ₹5,000 per-day sub-limit on room rent. If you pay higher rent, you will also be responsible for it.
Sub-limits also apply to ICU charges, specialist charges, and specific procedures, such as cataract surgery and joint replacement. The insurer imposes these sub-limits to manage its expenditure. However, this can result in increased hospitalisation costs for the policyholder.
A cap is the maximum that will be paid by your insurer for a particular benefit. For instance, there may be a cap on maternity costs of Rs. 50,000. If the bills exceed that amount, you or a family member will have to pay the remainder.
Caps are standard in health insurance policies. They are typically used in maternity care, ambulance fees, OPD benefits, and certain daycare services. Sub-limits and caps differ in that caps have fixed amounts that are not linked to the total sum insured.
The impact of the coverage limit is coupled with the effect on the claims you ultimately receive. Most people only consider the overall coverage when purchasing an insurance plan. The sub-limit and the cap affect claims silently.
In some cases, choosing a room that exceeds the allowed limit can result in proportionate deductions. In that case, the insurance company can deduct payments for other hospital services, such as doctor consultations and nursing fees. Hence, your contribution becomes higher.
A cumulative bonus in health insurance rewards you for not making a claim. You receive an increase in the sum insured for each year without a claim. Thus, after a few years, the cumulative bonus adds a substantial amount to your total insurance coverage.
This additional coverage is beneficial when healthcare expenses rise. However, it should be noted that even when a higher sum is insured, sub-limits may apply. Bonus cover is a beneficial addition, but it has certain limitations.
Today, various modern health insurance policies have reduced restrictions. Some policies do not include sub-limits on hospital rent, while others offer higher sub-limits or flexible coverage. One should always carefully read the policy's terms and conditions before purchase.
Spending a small amount of time during purchase can save you from future significant financial troubles. Asking appropriate questions and making proper decisions about plans can increase your confidence level in utilising health insurance.
Health insurance is not just about having a policy. Health insurance also involves understanding how it works. Health insurance limits, including sub-limits and specific covers, can significantly affect your claims experience. Understanding them well, along with other health insurance benefits such as a cumulative bonus, will help you make informed decisions and ensure you are well covered when you need it most.
Supriyo Khan
Supriyo Khan
Supriyo Khan
Supriyo Khan
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