Buying health insurance in India needs to be a careful task.
There have been incidents of painful moments investors have gone through at the time of hospitalizations and claims with the insurance company refusing to reimburse the actual expenses incurred.
In order to avoid hassles like these, one needs to keep in mind the following points before zeroing down on health insurance.
Let the buyer be aware is the policy as far as health insurance goes. Here are some basic questions to ask before buying health insurance.
1. Where do I buy my health insurance policy from – general insurance or life insurance companies ?
Life insurance companies are more focused on providing insurance (or rather investment in today’s world of mis-selling !!!) for life, so health insurance is not a central point of business for them.
Would you go to your neighborhood grocery store and buy loads of vegetables with the expectation that they will be green, leafy and fresh ? If you want to buy fresh vegetables, you would rather go to “sabzi mandi”.
Keep insurance simple – buy health insurance from general insurance firms. Note that if you were to buy it from life insurance companies, the charges would be slightly more.
2. Which general insurance companies should I look at ?
The ones that will pay your claim always ! But of course, you do not know that in advance.
So check the claim settlement records of the company. Ask the agent selling you the policy for these details. You might not get anywhere to begin with but make sure you check thoroughly before you buy – many health insurance companies are still trying to break even and are suffering heavy losses.
Also check for the solvency margin of the company – you do not want your insurer going bust within months of buying your policy especially if you are old aged.
3. Who is the TPA (Third Party Administrator)?
Check out who the TPA is and inquire about what it has to offer. Many TPAs might not cover the hospitals which you are looking at for future hospitalizations. So check with the TPA to see which all hospitals they cover.
Your interaction during and after hospitalization is with the TPA for claim settlement, so make sure you know the people you will be dealing with in your time of crisis.
Are you aware of other critical aspects to be kept in mind when taking health insurance ?
@Radhey,
I did not consider any of the above points before buying health insurance. My LIC agent, who is also an agent with National Insurance advised me to go for their medi-claim plan.
Another thing to keep in mind is to honestly declare any preexisting disease. A lot of people don’t it either in ignorance or deliberately. Later it becomes a reason for claim rejection.
It is also important to see how they treat those preexisting diseases i.e. if they cover after certain amount of years or just don’t cover at all.
I am not really bothered about TPA because they revise hospital list every year. The hospital that is networked today may not be networked tomorrow and vice versa. But yea it is important to know the reputation of the TPA. Some are really rude and should be avoided.
@Vivek,
Agree with you, we should always disclose existing illness. But sometimes the disease might have happened few years back and you are completely cured, so you may not mention it.
For eg. I had a policy with my employer through which i had done a claim. After that i took a policy from insurance company but forgot to mention that surgery. I also did a claim through them for another surgery which was not related to the previous surgery.
@Rakesh, You must declare previous surgery as well. In case same treatment is required in future and insurance company finds out that it is related to some previous illness, they will straight away reject the claim. Then it goes into unnecessary fight.
@Vivek,
Yes I know but i forgot to include the same. All the forms were filled by the agent i had to only sign, it never came across my mind. Now its too late to include. Hopefully i don’t incur the same illness again.
@Rakesh, Another lesson to be learnt, always fill your own forms and read them carefully!
Dear Vivek K,
Letting others fill up any application form, let alone very import forms like Insurance proposals is a dumb thing to do and at times dangerous.
The agents psychologically always favour their masters because they after all pay them. There is a very high risk in allowing the agents to fill up your forms. In very important cruch questions they will tend to enter answers that may damage your future claims.