Mumbai: These days health insurance is of crucial importance due to the ever-rising medical costs. Unlike in developed markets, health insurance plans in India are generally oriented towards covering costs of hospitalisation for illness or accident, subject to a long list of terms and conditions.

After the introduction of portability in health insurance, product innovations have become more meaningful and beneficial to policyholders.

According to insurance advisers, you should read the fineprint (policy documents) carefully before taking any decision to buy a health insurance scheme. You can also check sample policy documents on the website of insurer. 

Also, several insurers impose sub-limit clauses on room rent, doctor’s fees and you should take into consideration your own lifestyle needs, with respect to the kind of hospital and the type of room you would prefer, while deciding the sum assured for a policy. 

Here are five key aspects you must look out for before buying health insurance plans

1) Room rent 

Room rent benefit is the amount given to you on per day basis for availing a room in the hospital while undergoing treatment. Before buying a health insurance plan, always check the eligibility of room rent under your health insurance plan. 

Room rent benefit usually under a standard health insurance plans offer 1 per cent or 2 per cent of your base health insurance sum insured on per day basis. So, if you have opted for a health cover of Rs 5 lakh, you will be entitled to get Rs 5,000 per day as room rent benefit (if your health plan gives 1 per cent of the sum insured as room rent).

Also, there are health insurance plans which offer a single private room irrespective of the amount specified to be given on per day basis.

2) Individual and family floater

In individual policies each family member is insured for a specific amount whereas in family floater the whole family is insured for a particular amount. 

If your family is young or the age gap between the spouses is not much, then a floater plan will be cheaper. Being cheaper than the individual health plan, the floater health insurance plan makes a higher value cover more affordable.

However, the flip side is that while in an individual plan each individual has a dedicated sum insured, in a floater plan the insurance cover is shared. So if one family member makes a claim, the cover reduces on the rest by that much. 

Insurance advisers say individual plans are expensive compared to a floater policy. But the cost advantage of a family floater insurance plan diminishes if the age gap between the spouses, or the eldest member, is huge.

3) Sub-limit

This is one of the most major clauses in health insurance policies. You might happen taken the maximum sum assured, but at the time of claim you may end up getting only a part of your claim even though the particular treatment was completely covered by the policy.

These kinds of differences are by and large related to sub-limits. Sub-limits are categorised under two main sub categories:

First, sub-limits is on things like room rent, doctor's fees and medical operation theatre charges.

Suppose your sum assured is Rs 5 lakh and they have a clause of sub-limit which says that they will pay a maximum of 1 per cent of sum assured per day for room rent implying that the insurance company will pay a maximum of Rs 5,000 per day for room rent and anything additional would be paid by the insured.

However, these kinds of sub-limits are not there in all policies so you should prefer policies that do not have such sub-limits.

The second set of sub-limits is on diseases.

There are certain diseases that are covered within the policy but with a certain limit. For example a policy may say that it would cover cataract operation but with a limit of only Rs 25,000. This means that whatever cost you incur due to hospitalisation for cataract, the maximum you can claim is Rs. 25,000.

4) Pre-existing disease waiting period

The pre-existing disease is any kind of medical condition which an insured has attained or have symptoms of, before taking the health insurance policy.

The pre-existing disease is not covered under individual or floater health insurance plan. However, the same is included after the specified tenure known as the waiting period.

The waiting period for pre-existing disease usually ranges from 24 months to 48 months since the policy inception date.

It is important to see the waiting period clause before you make a final buy.

The lower the waiting period, better it is.

5) Top-up plan

As you grow older, health insurance becomes more expensive. So, to raise the cover while keeping costs in check, individuals should consider a top-up health insurance plan. 

A top-up health insurance plan is a regular indemnity plan that covers hospitalisation costs but only after a threshold limit is crossed. In insurance parlance, this limit is called deductible—the portion of the claim amount that is not covered by the insurer and which the insured has to pay before the benefits of the insurance policy can kick in.

Here’s an example. If you have a top-up plan of Rs 9 lakh with a deductible limit of, say, Rs 3 lakh, it means that the first Rs 3 lakh of the hospitalisation bill will have to be borne by the insured person, and the balance by the insurer.

If you run up a bill of Rs 9 lakh, you can use your individual health insurance policy from insurer A to pay Rs 3 lakh and then use a top-up cover from insurer B to pay the remaining Rs 6 lakh.