Medical bills may be incurred suddenly, hence the need to prepare oneself financially. Health insurance allows a person to deal with certain healthcare expenses in case he or she gets sick or injured, but it is important to know what you are signing up for before deciding on which one to purchase. In case you would like to find out what a health insurance policy, it is a contract between a health insurance company and a person who will be insured by the company.
What Is a Health Insurance Policy and What Does It Include?
A health insurance contract describes the benefits offered by the insurer, the claims and the requirements that have to be met by the insured.
Some common ones are:
- Hospitalization expenditure: The eligible cost of room rent, nursing fees, medicines, diagnostics and treatment during hospitalization.
- Daycare procedures: Treatments which do not necessitate a 24 hour stay in the hospital.
- Pre and post hospitalization: Medical expenses incurred prior to and after discharge from hospital, within the given period of time.
- Ambulance expenses: Eligible expense for ambulance services, according to the terms of the policy.
Key Health Insurance Terms Every Policyholder Should Know
Knowing the basics of insurance terminology makes it simpler to compare insurance policies. Here are some basic terms that should be looked into prior to buying an insurance plan.
- Sum insured: The upper limit that is available for covering the expenses for the relevant insurance policy period, based on the terms of the policy.
- Premium: The payment made to the insurance company for covering you under their plan.
- Deductible: The amount that the insured must pay out of their own pocket for eligible expenses before the insurance company makes payments based on the terms of the policy.
- Co-payment: A percentage or portion of eligible expenses which is payable by the policyholder.
- Sub-limit: A limit on the payment that can be made for a particular type of expense or treatment, regardless of the total sum insured.
Waiting Periods and Exclusions: What Is Not Covered?
Certain conditions could apply to prevent certain expenses from being eligible for coverage. This is among the aspects which you need to understand in order to understand what a health insurance policy means.
- Initial waiting period: A particular period starting from when the policy starts within which certain non-emergency illnesses would not be covered.
- Pre-existing disease waiting period: There might be pre-existing diseases which will only be covered after the waiting period applies.
- Specified disease waiting periods: Some particular diseases or procedures could have their own waiting period.
- Permanent exclusions: There could be some treatments which are permanently not covered by the policy.
Non-medical expenses: There could be some non-medical costs which will not be covered unless it is stated that they will be covered in the policy.
How to Read Your Health Insurance Policy Documents
Before buying or renewing insurance policy, you should go through the policy documents carefully to understand the rights and liabilities.
Guidelines are as follows:
- Confirm your personal details: Confirm that all the personal details including names and ages are correct in the documents.
- Limitations on coverage: This would include sum insured, room rent restrictions, and sub limits for each treatment individually.
- Claim process: Understand the procedure of cashless treatment and claim reimbursement.
- Waiting period and exclusions: This would include the waiting period and any exclusions that might be considered for future claims.
- Renewal terms: This would include the date of renewal, change in premium, and terms of renewal of the policy.
In case you have any doubt regarding the clauses of the policy, then clear them before buying the policy.
Conclusion
By knowing about the elements that make up a health insurance policy, one can make wise choices regarding the selection of a health insurance policy. Having an awareness about certain elements such as the maximum coverage amount, deductible amount, co-pay, waiting period, and exclusions will help you ascertain whether the policy suits you. It is important to study the documents of the policy, know about its benefits, and find out about the things that are not clear.
