Skip to main content

Things to Know about Health Insurance

Buy Gold Mutual Funds

Invest Mutual Funds Online

Download Mutual Fund Application Forms

Call 0 94 8300 8300 (India)

When taking health insurance, what we have noticed is that most people don't actually do any sort of structured research. Luckily, that's what we're here for. This article will go into the salient features of a mediclaim policy that you need to know, address types of mediclaim policies (individual and floater), and also run a brief comparison between mediclaim policies from some popular insurers - all in easy-to-read FAQ format.



Let's get started.


1. What is a Mediclaim policy?

A Mediclaim policy is a health insurance policy which covers all medical treatment expenses up to the sum assured in case you are hospitalized due to an illness / accident.

Mediclaim policies are issued for a period of one year and are renewed annually.

2. What are Pre - Hospitalization Expenses?

These are expenses you incur before you are hospitalized. They can include doctor's consultation fees, medical tests, medication, and related expenditures. Mediclaim policies generally cover 30 days expenses immediately before you have to be hospitalized.

3. What are Post - Hospitalization Expenses?

These are expenses you incur once you are discharged from hospital. They can include things such as doctor's consultation fees, medication, further tests (checkups), and even physiotherapy. The medical expenses you incur in the 60 days immediately after you are discharged from the hospital are usually covered by your mediclaim.

4. What is the Tax Benefit of taking mediclaim?

While this is not a reason for taking mediclaim, it does help that you also get a tax benefit on your health insurance. The premium paid for these policies are deductible under section 80 D of Income Tax Act up to a maximum limit of Rs. 15,000 and Rs. 20,000 in case the person insured is a senior citizen. In case an individual pays health insurance premium for his or her dependent parents then an additional deduction up to a maximum limit of Rs.15,000 is allowed and in case parents are senior citizen then Rs. 20,000 is allowed. To know more about various tax deductions you can avail


So if you are paying for yourself and your senior citizen parents, you can claim a maximum of Rs. 35,000 p.a. under Section 80D.

5. What is Cumulative Bonus / No Claim Bonus?

In short, it is the insurer's way of rewarding you for paying a premium and not making any claim. Generally Mediclaim policies provide an additional cover of 5% of Sum Assured in the subsequent renewal of the policy in case there is no claim in the current policy year. This increase in sum assured of 5% every year is restricted to a maximum of 50% of the initial Sum Assured for most policies. If there is a claim in the policy then this additional cover is decreased by 10% on the next renewal. These percentages can vary depending on the insurer and the policy you choose.

6. What are the types of mediclaim policies available?

Mediclaim policies are of two types:

a.  Individual Mediclaim Policy

Individual policy covers only one single person under one policy. The premium in this type of policy is calculated according to the age of the person to be covered under the policy. Under this policy, if the sum assured is Rs. 5 Lakhs then the person insured can claim up to the maximum limit of Rs. 5 Lakhs.

b.  Family Floater Mediclaim Policy

Family floater policy covers the entire family i.e. self, spouse and the dependent children under one single policy. The premium under this type of policy is calculated according to the member with the highest age in the family. Under this policy, if the sum assured is Rs. 5 Lakhs then any one person individually or the entire family jointly can claim up to the maximum limit of Rs. 5 Lakhs.

7. Can you briefly compare some key insurer's mediclaim policies?

Definitely. Below is the comparison between features of Mediclaim policies provided by different insurance companies:

COMPANY

ENTRY AGE

RENEWAL UP TO AGE

PRE-EXISTING DISEASES COVERED FROM

NO CLAIM BONUS

CASHLESS FACILITY AVAILABLE

FAMILY DISCOUNT

NEW INDIA

18 - 60

Lifetime

5th year

5% of SA

Yes

10%

UNITED

1 - 60

Lifetime

5th year

5% Discount every year (max 25%)

Yes

5%

ORIENTAL

18 - 45

Lifetime

5th year

-

Yes

-

BAJAJ

1 - 65

80

5th year

-

Yes

10%

NATIONAL

18 - 59

80

5th year

5% of SA every year (max 50%)

Yes

-

 

The policy you choose will depend on the cover you require, the features you feel will be most beneficial to you.

8. What is a Top Up plan?

Earlier, most insurance companies limited their mediclaim to Rs. 5 lakhs. This is no longer the case, there are many insurance companies which allow even more than Rs. 10 lakhs of health insurance cover. However, this was not always the case. And also, some of the companies that allow higher cover might not be your first choice of insurer. So earlier, if you wanted more than Rs. 5 lakhs cover, your best option was to go for a Top Up Plan.

Top Ups provide you additional coverage at a low cost. Top up plan covers medical treatment cost over and above the actual Mediclaim policy and thus increase the total sum assured. Top up plan can be taken for an individual as well as for the entire family. However top up plans are available only if the sum assured taken in the Mediclaim policy is between Rs. 3 to Rs. 5 Lakhs.

For example:

Our favourite fictional character, Mr. Shah has taken a Mediclaim policy for a sum assured of Rs. 3 Lakhs and a top up plan for Rs. 7 Lakhs, so his total sum assured is Rs. 10 Lakhs. If a claim arises for a sum of Rs. 8 Lakhs then the first 3 Lakhs has to be borne by the Mediclaim insurance company and next Rs. 5 Lakhs is to be paid by the company from which top up plan has been taken.

Remember that the Insurance Company from which the top up plan has been taken will not be responsible for claims arising up to the sum of Rs. 3 Lakhs.

Top up insurance plans are targeted by insurance companies to those customers who already have Mediclaim insurance policies but find their cover to be low and hence these customers want to add additional cover. Now, if you are also thinking that your Mediclaim policy is not sufficient to cover your expenses in case of hospitalization and the present insurer is not ready to increase the cover, then a top up policy from another insurer is the solution for you.

Happy Investing!!

 

We can help. Call 0 94 8300 8300 (India)

 

Leave your comment with mail ID and we will answer them

                        OR

You can write back to us at prajnacapital [at] gmail [dot] com

---------------------------------------------

Invest Mutual Funds Online

Transact Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Download Mutual Fund Application Forms

Best Performing Mutual Funds

    1. Largecap Funds        Invest Online
      1. DSP BlackRock Top 100 Fund
      2. ICICI Prudential Focused Blue Chip Fund
      3. Birla Sun Life Front Line Equity Fund
    2. Large and Midcap Funds     Invest Online
      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
    1. Mid and SmallCap Funds    Invest Online
      1. Reliance Equity Opportunities Fund
      2. DSP BlackRock Small & Midcap Fund
      3. Sundaram Select Midcap
      4. IDFC Premier Equity Fund
    1. Small and MicroCap Funds             Invest Online
      1. DSP BlackRock MicroCap Fund
    1. Sector Funds              Invest Online
      1. Reliance Banking Fund
      2. Reliance Banking Fund
    1. Gold Mutual Funds             Invest Online
      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund

Popular posts from this blog

Real Returns in Investing

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300 Real Returns in Investing     A Anil Singh (name changed), 44, works with a private company and believes in investing his entire savings in fixed deposits. His financials from the year 2000 till date is given in the table. Anil's savings in FDs gave him an average return of around 8%. The total amount saved over the 174 months (From January 2000 to June 2014) is Rs 49.80 lakh. The value of his investment today is around Rs 66.71 lakh. Naveen Singh (name changed), 44, works in a similar profile like Anil. However his expenses were on the higher side. His financials are as in the table. Naveen invested only in equities. The total amount saved over the 174 months (From January 2000 to June 2014) is Rs 38.40 lakh. The v...

Budget 2014 Highlights for Saving

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   The new finance minister Arun Jaitley has just presented his first budget. What measures does the budget contain that will specifically impact savers and investors? Here they are: 1. Housing loans exemption for self-occupied properties increased to Rs2 lakh: Earlier this amount was Rs1.5 lakhs. This move barely keeps pace with the inflation in asset values.   2. Investment limit under 80 (C) increased to Rs1.5 lakh: This is a good move again and offers some relief to taxpayers.   3. IT exemption increased to Rs2.5 lakh, Rs3 lakh for senior citizens. This comes as a minor relief for taxpayers.   4. Annual PPF ceiling to be enhanced to Rs1.5 lakh, from Rs1 lakh: This is in tune with the change in 80C.   5. Long term capital gains tax for debt funds has been rai...

ICICI Prudential MIP 25 - Invest Online

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   ICICI Prudential MIP 25     (CRISIL Rank 2)   This scheme was launched March 2004. Please see the chart below for the one, two, three and five years annualized returns from this scheme. The minimum investment in the scheme is Rs 5,000. The asset allocation of the portfolio is 24% equity, 72% debt and 4% cash equivalent and others. Please see the chart below for the monthly dividends declared by the scheme, on a per unit basis, over the last 5 years.   For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call Leave a missed Call on 94 8300 8300 Leave your comment with mai...

Franklin India Smaller Companies Fund - Invest Online

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   Franklin India Smaller Companies Fund   While the universe of small-cap stocks in India is vast, there are very few equity funds which take on the task of sifting through this space for good long-term bets. Franklin India Smaller Companies Fund has managed this with aplomb. What we like about this fund is its significant out-performance of its category and benchmark over the last four years, and its ability to moderate portfolio risk despite investing in the riskiest segment of the equity market. This fund's stock selection strategy, like that of Franklin India Prima Fund is focused on finding companies that generate positive cash flows across business cycles. High return on investment and manageable leverage are also filtering criteria. Says R. Janakiraman, fund ma...

How to open a Capital Gains Account?

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   How to open a Capital Gains Account? You can open a capital gains account in an authorized bank. The Government has notified 28 banks which can open the Capital Gains Account on behalf of the Government. You have to apply for opening the account by filling out the required application form (Form A) and submit proof of address, PAN card and photograph. You cannot withdraw funds from a capital gains account using a cheque book or ATM, like you do in your normal savings bank account. There are procedures to be followed to withdraw funds from the capital gains account. Investment in Specified Bonds Section 54EC of Income Act provide that if the seller invests whole or part of capital gains arising from the sale of asset in specified Capital Gains, within a period of six months of the ...
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now