Many of us have employer-provided health insurance. But have you never thought of who will pay the claim amount in case it is more than the sum insured? In such situation, the cheapest options are buying Top Up Health Insurance Plan & Super Top Health Insurance Plan. Let us see how they will be handy in such situations.
Considering the current health cost in India, especially in big cities, it is hard to believe that health insurance coverage of around Rs.3 lakh to Rs.5 lakh is sufficient. Also, many of salaried completely depend on employer-provided health insurance.
#Let us first discussTop Up Health Insurance Plan.
Top Up Health Insurance plan is a regular health insurance plan. But with certain threshold limit (deductible) to it. For example, if Top Up Health Insurance Plan offering you sum insurance of Rs.10 Lakh with threshold (deductible) limit of Rs.5 lakh. Then any health insurance claim arising more than Rs.5 lakh will be payable by this top up health insurance. Below Rs.5 lakh claim must be settled either by regular health insurance or we have to pay from our own pocket.
Let us say Mr.X has a regular health insurance of sum insured Rs.5 Lakh and a top up health insurance of Rs.10 lakh with a threshold limit of Rs.5 lakh. Suddenly one day due to health issues he got admitted to the hospital. The claim bill amount was Rs.6 lakh. His regular health insurance will pay Rs.5 lakh (as the maximum sum insured is Rs.5 lakh only). Who will pay the remaining Rs.1 lakh? As the claim amount is more than the threshold limit set by top-up health insurance, remaining Rs.1 lakh will be payable by this top up health insurance.
In the absence of any such top up health insurance, Mr.X might be forced to pay the remaining Rs.1 lakh claim amount from his own pocket. I explained the different scenarios of how the regular health insurance and top up health insurance will work in below image.
Now you got an idea of where the Top Up Health Insurance will be handy, apart from regular health insurance plans. If there is more than one claim in a single year, then such top up plan will not be useful, as these top up plans only applicable to one claim per year. If that particular single claim is above threshold limit, then you get the claim amount from top up plans. Otherwise, such top up plans will not be useful.
Here in such a situation, super top up health insurance plan will come in handy.
#Let us discussSuperTop Up Health Insurance Plan.
Super Top Up Health Insurance Plan works exactly like Top Up Health Insurance but with only one difference. In Top Up Health Insurance Plan, there is a limit for a claim in a year i.e. single claim in a year. However, in case of Super Top Up Health Insurance Plan, there is no such limit.
For example, in the last scenario of the above table, if Mr.X has Super Top Up Health Insurance, then the remaining Rs.3 lakh might be settled by this super top up health insurance but not from his own pocket.
Super Top Up Plans will consider the total claim amount in a year. Whatever the amount below threshold limit must be payable either by regular health insurance or from our own pocket. The remaining amount will be payable by super top up health insurance plans. I tried to explain the same in below image.
See from above table where I highlighted the last row with a different colour. Here Super Top Up Health Insurance Plan will come into handy than regular plans or Top Up Health Insurance Plan.
Features of Top Up Health Insurance Plan & Super Top Health Insurance Plan
- No restriction to have Regular Health Insurance-There is no such restriction that you must have regular health insurance to buy either of these two. If you have regular health insurance, then below the threshold amount will be settled by the regular plans and above threshold claim amount by either of these two.
- Can buy from different insurers-You can buy regular health insurance from one company and top up plans from a different company.
- Cheaper than Regular Health Insurance Plans-Due to threshold limit or deductible clause, these plans are cheaper than regular health insurance plans.
- Both Individual and Family Floater Plans Available-Exactly like typical regular health insurance products, such top up plans will offer you to an individual or to a whole family.
- Come with regular exclusions-Regular exclusions also applicable to top up plans like existing diseases or dental care. Hence, check out for exclusions in detail.
- Tax Benefit-Exactly like regular health insurance products, you can claim the tax deduction under Sec.80D of IT Act.
- Works on reimbursement base-Before settling the claims under top up plans, insurers first check whether the below threshold limit amount of total claim bills paid from a policyholder or not. They will not bother whether below threshold amount is from the policyholder’s own pocket or from his regular health insurance. Then only any dues of above threshold limit settled by top up plans. Hence, you may say that getting cashless benefit from the top up plans is difficult.
- No NCB (No Claim Bonus)-These plans usually not offer any NCB benefits.
Who can go for Top Up Health Insurance Plan & Super Top Health Insurance Plan?
If your health insurance is negligible and budget is your problem, then definitely you can this of buying Top Up Health Insurance Plan & Super Top Health Insurance Plan. Because they are cheap. But do remember that claim settlement may be cumbersome with Top Up Health Insurance Plan & Super Top Health Insurance Plan. Hence, it is better to increase your cover from the existing health insurance itself.
If you plan to increase your health insurance cover, then first try to compare the premium of top up plans with regular plans. Go for top up plans only in case you feel cheaper than going for regular plans.
Usually, minor claims are more frequent than the huge claims. Hence, you may end up in forgetting the features of such top plans. Hence, make sure that you know the details regularly and it’s applicability.
Few Top Up Health Insurance Plan & Super Top Health Insurance Plan available in market
- United India Super Top Up plan
- Apollo Munich Optima Super Top Up
- Max Bupa Super Top Up plan
- HDFC Ergo Health Suraksha Top Up Plus
- Cigna TTK Super Top Plan
- Bajaj Allianz Extra Care
- Religare enhance
- ICICI Lombard Health Care Plus
- Star Super Surplus
You may also refer our earlier posts on Health Insurance.
- IRDA Incurred Claim Ratio-How to choose the best health Insurance?
- Jeevan Arogya-Do you know this LIC’s Health or Medical Insurance Policy?
- Best Senior Citizen Health Insurance in India-Product Comparison
- Facts about Third Party Administrator (TPA) of Health Insurance
- Senior citizen health insurance-Apollo Munich’s “Optima Senior