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Choose from multiple health insurance policies

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How to choose from multiple health insurance policies in case of a claim is a question asked time and again.

 

"My employer already provides health insurance for my entire family. Should I take individual cover, too?" Earlier, this was often asked. Nowadays, most people buy individual health insurance policies as well, due to concern on coverage after retirement, as most employer policies don't provide for this. Employers are cutting total coverage amounts, as well as coverage of parents due to soaring premium costs; hospitalisation costs have risen sharply and have rendered employer policy limits inadequate.

Also, not having an individual health policy restricts job mobility, as prospective employers may not provide health insurance benefits.

The widespread practice of buying individual health insurance policies by employees whose employers offer group insurance has led to a fresh question:  In case of a claim, should I claim on my employer policy or on my individual policy?" Before February 2013, the answer was fairly easy. Most policies, including group policies, had

a' contribution' clause, under which the policy holder had to inform all the insurance companies concerned, and the insurance companies would pay the claim in proportion to the coverage provided by them. Now, according to regulations, the consumer has a choice: He can choose any of the policies that cover a particular claim and the insurance company cannot insist on the payment proportionate to the contribution clause. So, how should a consumer exercise this choice?

Here are our recommendations:

1. If the claim arises in respect of family members with a pre- existing disease, use the employer group policy, as the claim process would be easy

2. If you don't have a family member with a pre- existing disease, you should use the group policy, so that you don't lose your accumulated bonus and/ or be hit with premium loading during the renewal of the individual policy

3. If the claim arises in respect of people with no pre- existing disease but you have family members with such a disease, it is better to use the individual policy and reserve the group policy for family members with such a disease As is evident, group policies usually cover all pre- existing diseases and, therefore, the claim process and the cashless process are much easier for group policies. In fact, people choose to make a claim on the group policy simply because cashless facility is easily available, compared to an individual policy.

But if you are faced with a situation akin to point 3 mentioned above, it might be a good idea to try to get the cashless facility on the individual policy as well and, in the worst- case scenario, to pay the bill yourself and seek reimbursement later. Just ensure you also intimate the insurance company that provides the group policy about a potential claim as soon as hospitalisation occurs, and pursue the cashless facility with the other insurance company. Even if you don't get the cashless facility and you feel your claim might be rejected, you retain the right to make a claim on the group policy on a reimbursement basis.

Of course, if the claim amount is such that it cannot be covered by one policy, you may have no choice but to make a claim from both the insurance companies, which would pay on a proportionate basis.

How you choose the policy on which you would make a specific claim could significantly affect your ability to secure claims. With hospitalisation costs soaring, a wise step in this direction could significantly improve your ability to weather something unexpected. So, choose wisely.

Happy Investing!!

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