How to Buy the Best Health Insurance Policy

The purpose of a health insurance plan is to provide timely and adequate financial support during medical emergencies. Yet, policyholders often lament that their health insurance plans do not serve the requisite purpose despite the fat insurance premiums they pay. This is because frequently, in times of pressing medical situations, either the health insurance plan does not offer sufficient coverage, or the claim is denied altogether.

Although insurers are sometimes to blame due to lack of transparency or loopholes that policyholders fail to observe, it is also true that at other times, the fault lies either with the policyholders or the process/circumstances under which the health insurance plan is purchased.

Here are some of the most common reasons why health insurance policies fail to succeed:

Insufficient cover, low premiums
To factor in the ever-growing medical inflation, it is crucial that more than adequate cover be taken while buying a health insurance policy. Without sufficient cover, even the best health insurance plan is only a piece of paper without any value. For instance, a health plan with a cover for Rs. 3 lakhs creates a huge setback if a person suffers major health issues like a cardiac or brain surgery, both of which cost close to Rs 6 lakhs. In these cases, despite having a health insurance plan, the inadequate medical cover leads to financial stress.

Also, people generally have an impression that a low health insurance premium translates to a good deal.
In reality, the reverse is true – lower premiums mean lower benefits. The insurance company may not provide cover for pre and post hospitalisation expenses, may put a limit on specific surgeries or hospital room expenses, or completely exclude certain diseases from the policy coverage. Such restrictions offset the benefits of the health insurance plan.

The fine print
It usually seems like a task to go through an insurance policy’s technical terms and conditions. However, to get a fair deal, it is important to read all terms and conditions in detail to know our rights and understand what exactly we are signing up for. For instance, some policies have a waiting period clause stating that if there are any pre-existing diseases, then before filing the claim, the policyholder will have to wait a minimum of 12 months from the time of policy commencement.

Also, hospital room/ICU charges are sometimes paid out as a pre-defined percentage and not at actual. If the policyholder goes ahead and files the claim without being aware of such clauses, the claim will be rejected.

Hasty decisions
Most people are unaware about the different health insurance plans available and the offerings/options that come along as a package deal. People therefore tend to hastily purchase the first health insurance plan they come across without giving it a serious thought. This leads to an incorrect, unsuitable health plan purchased in haste, either due to one’s own lack of awareness or possibly due to the insurance agents’ persuasion strategies.

Not making comparisons
Insurance agents mostly sell policies in line with their own priorities rather than the customer’s expectations, needs and requirements. They usually focus on having people buy those health plans from which they canearn higher commissions. Hence, not comparing different policies and going blindly by the agent’s word may lead to disappointment in future.

Not knowing enough
One of the biggest blunders people sometimes make is not researching enough on their own about various insurance products available. It is always better and wiser to do maximum research, draw comparisons and find a health insurance policy that is in sync with yours and your family’s specific needs and requirements. The internet offers a wealth of information where you can find various policies, compare, understand and decide – all at the click of a button. Making comparisons between different options can help in getting the best and customized health insurance, at the best prices, with the best offerings/inclusions.

More than a tax-saving instrument
Many of us believe that insurance is yet another tax-saving instrument. This leads to people only considering the premium amount without taking into account how useful the policy will actually be towards covering medical expenses in times of real need. One may think they have bought a great policy by looking at the low premium payable, whereas the policy may not include essentialities like pre-existing disease coverage, etc. This leads to bigger expenses in times of medical emergencies, despite having health insurance.

Avoiding these mistakes and exercising caution while purchasing a health insurance plan ensures that the policy helps overcome financial obstacles during a medical crisis.