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AFP

Best mediclaim policies for you

Co-pay lowers the premium, but can be restrictive

How do you buy a health insurance plan? If you just settle with the plan your agent sells or are happy knowing you have bought the cheapest plan, there is a bit of unlearning and a lot of learning in store for you. A health insurance policy packs in several features and caveats. To give you a ready comparison, we designed Mint Mediclaim Ratings (MMR), which was developed by SecureNow Insurance Broker Pvt. Ltd. The full ratings along with the methodology can be seen here:http://www.livemint.com/mintmediratings.

In the ratings, for family floater plans, we have considered two sum insured amounts ( 10 lakh and 20 lakh) and three age categories in each—eldest insured member is 35, 45 or 65 years old. For individual plans, the age categories are the same but the sum assured is 5 lakh. The newest edition of the ratings (July 2015) also includes individual plans of 5 lakh, 10 lakh and 20 lakh for a person aged 70 years.

This week, we spotlight individual policies with sum assured 5 lakh, where the person is 65 years old.

We also explain some of the important aspects that one should look at while choosing a policy.

Let’s look at copayment.

Co-payment can be linked to age, geography or hospital. In terms of age, for senior citizens, co-payment is usually a regular feature in health insurance plans because they are considered high risk. So, to reduce risk and, hence, the premium, insurers include co-payment. This way when a claim is made, you pay a certain percentage of that amount and lower the burden on the insurer. The second type of co-payment is based on geographies. For who those live in smaller cities, insurers offer plans under which if the policyholder makes a claim in a smaller city, the insurer will pay the entire claim amount. But if the policyholder chooses to go to a bigger city, where the cost of hospitalization is higher, the insurer will expect you to pay a certain percentage of the claim. The rationale is that medical expenses in smaller towns is lower, so insurers charge such policyholders a lower premium with a condition to co-pay if the insured goes to a bigger city for treatment. In the third type of co-payment, co-pay is introduced if you visit a non-network hospital. This helps insurers keep costs in check as it has pre-negotiated rates at network hospitals. Co-pay lowers the premium, but can be restrictive. Hence, policies with no co-pay get the highest score.

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