What is health insurance?
Insurance designed to fulfill your surgical expenses and medical coverage is called health insurance. The individual may be reimbursed for the payment made, or in other cases the hospital or medical facility is directly paid by the insurance firm. In few countries across the world, health insurance is considered as a basic right, and is to be provided by the government to its citizens.
There are generally two types:
- Public health insurance
- Private health insurance
Why should one have health insurance?
Health insurance plans are aimed at relieving you from the stress that comes along when you or your family member is hospitalized. A good health insurance policy protects you from the colossal costs to be paid for the treatment. It also includes preventive care and acts as an overall back up. Think of health insurance as your safety net.
What is ‘restore’ in health insurance?
A restore or refill option allows restoration benefit.
For example: You have a cover of 6 lakh rupees, and the entire sum gets used up in treating your heart, generally you would be praying you don’t get hospitalized again during the same policy year. With the restore benefit, the cover amount gets replenished and can be used again for your treatment in the same year.
Health insurance plans with restore option are 5-10% more expensive comparatively.
Limitations:
- The entire sum must be exhausted including the no claim bonus of the same policy year.
- The second treatment must be completely unrelated i.e. if you got hospitalized for a heart ailment the first time, the restore option would come into play only if it is a problem unrelated to the heart.
What is ‘recharge’ in health insurance?
The recharge option is made available only once the deductible amount is exceeded by the amount claimed, in a single treatment or hospitalization period. Once the sum assured and no claim bonus for the policy year are both exhausted, the sum assured is recharged or renewed. The basis of this option is that insurers feel confident that the bill will not exceed the assured amount in a single claim, and the chances of a totally unrelated illness are quite low.
Limitations:
- This option can only be used for future subsequent claims made in the same policy year regarding an unassociated problem.
- The recharge amount cannot be carried forward to the next policy year.
Which health insurance should you choose?
Factors that should influence your decision include:
- Number of family members
- Age
- Medical History
- Cover details
- Policy limitations and exclusions
- Option of multiple covers, etc.
There are always conditions applicable, and insurance isn’t an investment financially, but an investment towards your better health. Therefore, instead of thinking of profitability, one should think of which is the best health insurance that provides a better cover for anticipated problems in the near future.
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