Medical costs are going up by the day due to inflation and to safe guard themselves most people have bought individual health policies or are covered by a group insurance which is employer sponsored. Now, taking into account the increasing cost of treatment it is recommended that a top up plan would be a wise option.
A top up cover means you are increasing the amount you are insured for at an additional cost. For example when you are covered for the sum of Rs. 2 lakh and the cost of your hospitalization is Rs. 4 lakh you end up paying 2 lakhs. With a top up cover plan - you can top up with 5 lakhs - when your hospital expenses are for e.g. 3 lakh your policy will pay for 2 lakh and the top up plan will pay the additional 1 lakh. In case you are again hospitalized then neither policy will cover the expenses as the first policy will be claimed to the full and the top up has a threshold limit.
Only a few companies offer the top up cover plan.
The other option available is the super top up plan. It is like the top up cover though in this plan the threshold limit is applicable on every instance of hospitalization. You can avail funds for the 2nd and 3rd hospitalization. The premium for this is higher than a top up plan. A super top up plan is available to the extent of 10 lakhs.
Top up plans are cost effective - a top and super top up is at least 3 times cheaper than the cost of a basic plan.
Tax benefits can be claimed under Section 80-D on top up and super top up plans.
Both the top up and super top up can be taken without a basic plan also.
You can take a top up plan in addition to a group health insurance plan.
A top up plan can be taken from any company, the company for the basic plan and the company for the top up can be different.
Sridharan.S, August 2014
Hannah Punitha (IRDA Licence Number: 2710062)