All That You Should Know about Health Insurance Top-up Plans
Posted by raghavendra on March 24th, 2021
A health insurance plan covers your needs during uncertainty. But what if the hospital bills exceed your insurance cover amount? Will you pay from your pocket? That’s where a top-up plan comes in handy. With it, you can avoid this situation.
Keep reading to know the answers.
Top-up Plan - What It Is
A top-up plan is a type of insurance policy that is designed to cover hospitalization expenses. The coverage kicks in only after the threshold limit (deductible) is crossed. A deductible is a share of the claim amount. It is not covered by the insurance company The policyholder has to pay it before the top-up policy benefits kick in.
A top-up product serves like a stephney to your health reimbursement policy after the sum insured limit is exhausted. Regular health insurance reimburses hospital bills up to the sum insured while a top-top plan provides coverage amount after a certain threshold is reached.
Top-up Plans and Super Top-up Plans - Know the Difference
Super top-up plan:
Let’s understand top-up and super top-up plans with this example:
Nikhil and Gaurav are hospitalized. Nikhil has a top-up plan and Gaurav has a super-top-up policy. Their plans cover a basic health policy of Rs 3 lakh. Say the claims raised to both for a particular year are Rs 3 lakh, Rs 1 lakh, and Rs 4 lakh.
Top-up Plans - Know Their Benefits
Cost-Effective - A top-plan is more affordable than increasing the base cover of your existing health insurance. Say, Nikhil has health insurance of Rs. 5 lakh for which he is paying an annual premium of Rs. 8,000. But, the coverage amount is not enough for Nikhil. He feels he should have 8 lakh as the coverage amount. In this case, if Nikhil decides to increase the cover of his existing plan from Rs 5 lakh to Rs 8 lakh, the premium amount will be almost 12,000 annually.
In another case, if Nikhil has an insurance policy, then the premium amount for the 8 lakh insurance coverage will be generally 1,000 per lakh cover. So, for any additional 3 lakh cover, you will have to pay only Rs. 3,000. The total premium will be 11,000.
Increased Coverage Limit - Do you want to increase the sum insured of your health insurance? You will be allowed to increase to a certain extent. Each insurer determines up to what limit they will allow insured to increase their coverage amount. By purchasing a top-up plan or super-top plan, increasing the coverage amount to meet your medical needs is up to you.
Top-up Plan: How to Choose It
Deducible determines the plan premium. However, the top-up plans bridge the ga between existing policies and actual costs. The motive is not to duplicate but grab an extra cover at an affordable cost. So, nothing to worry about exclusions, like dental treatment and day care. They will be maintained by your base plan. However, check the following points before choosing a top-up plan.
Top-up plans in health insurance give you a feasible way to increase the claim amount of your health insurance coverage amount. However, reading the policy wording carefully is paramount to understand the terms and conditions. This will stop you from facing any difficulty when purchasing a health insurance top-up policy.
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About the Authorraghavendra
Joined: February 22nd, 2021
Articles Posted: 8
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