Selecting a health insurance plan is an essential financial decision for you and your family. With the costs of health care on the rise and more people facing lifestyle-related challenges to health, making an informed decision about health insurance coverage will help you receive quality care without draining your savings account.
With more choices than ever before, finding the best health insurance plan for you can feel overwhelming. This guide will help you make an informed choice regarding how to choose a health insurance plan by identifying various factors you should consider.
1. Assess Your Healthcare Needs
The first step in picking the best policy is to assess your current health care needs. Your age, whether you have children, your existing medical circumstances, and prospective care all help define the type of coverage that is appropriate to buy.
- For Young Professionals: A minimal health plan with moderate coverage that can be added to by riders later will satisfy your needs.
- For a Family with Children: Family floater plans will provide more options for coverage under one sum insured, often at more economical rates compared with separate policies.
- For Senior Citizens: Age-related plans, while more costly, will generally provide you with greater coverage for illness-related forms of ageing.
Tip: If you have a family history of critical illnesses like heart disease or diabetes, look for a plan that covers such conditions, either in the base policy or through add-ons.
2. Choose the Right Sum Insured
The sum insured is the maximum amount your insurance provider will pay for hospitalisation or medical expenses in a policy year. Choosing the correct sum insured is crucial to avoid underinsurance.
- For individuals living in metro cities, where healthcare costs are significantly higher, opt for a sum insured of at least ₹10–15 lakhs.
- For smaller towns and young individuals, a coverage of ₹5–10 lakhs may be sufficient.
- For families, consider a higher sum insured to ensure adequate protection for all members.
Remember, buying health insurance with too low a coverage may save on premiums, but could leave you with high out-of-pocket expenses during medical emergencies.
3. Check the Network Hospitals
One of the key benefits of health insurance is cashless treatment. For this, insurers tie up with a vast network of hospitals. Always check if your preferred hospitals or healthcare providers are part of the insurer’s network.
- A vast hospital network ensures access to quality healthcare without worrying about upfront payments.
- In emergencies, a nearby network hospital can save you valuable time and effort.
Tip: Look for insurers that provide an easily accessible list of empanelled hospitals online.
4. Understand Inclusions and Exclusions
Every health insurance plan comes with inclusions (what is covered) and exclusions (what is not covered). Reading the policy wording carefully ensures there are no unpleasant surprises during claim settlement.
Common inclusions:
- Hospitalization expenses
- Daycare treatments
- Pre- and post-hospitalisation expenses
Common exclusions:
- Cosmetic treatments
- Pre-existing illnesses during the waiting period
- Injuries from hazardous activities
Tip: If you are buying health insurance, always review the policy wording carefully to understand the exact terms, conditions, and exclusions.
5. Compare Premiums and Benefits
When choosing the best health insurance, don’t focus only on the premium. A cheaper policy may come with limited benefits, high co-payments, or sub-limits. Instead, compare plans holistically by evaluating:
- Coverage vs. premium: Ensure the benefits justify the cost.
- Co-payment clauses: Some policies require you to bear a percentage of the claim.
- Sub-limits: Check if there are caps on room rent, specific surgeries, or treatments.
Tip: Online comparison tools can help you evaluate multiple policies side by side to find a balance between affordability and coverage.
6. Check the Claim Settlement Ratio (CSR)
The Claim Settlement Ratio (CSR) indicates the percentage of claims an insurer has settled against the total claims received in a year. A higher CSR reflects reliability and smoother claim processing.
- Look for insurers with a CSR above 90%, as this demonstrates strong claim servicing ability.
- Review claim settlement processes: Does the insurer provide 24/7 support? How fast are claims processed?
- Read customer reviews to understand real-life claim experiences.
Tip: While buying health insurance, never overlook CSR, as it reflects the insurer’s trustworthiness.
7. Look for Additional Benefits
Apart from standard coverage, many insurers provide additional benefits that enhance the value of your policy:
- No-Claim Bonus (NCB): Reward for not making a claim in a policy year, usually offered as an increase in sum insured without a higher premium.
- Wellness programs: Discounts on gym memberships, free health check-ups, and wellness tracking.
- Maternity and newborn cover: Ideal for young couples planning a family.
- Preventive care: Coverage for annual health check-ups encourages proactive healthcare.
Tip: Always read the fine print in the policy wording to know how these benefits apply.
Common Mistakes to Avoid When Choosing Health Insurance
While understanding how to choose a health insurance plan, avoid these pitfalls:
- Only looking at the premium: Cheaper isn’t always better. Focus on comprehensive coverage.
- Ignoring waiting periods: Pre-existing conditions may not be covered immediately.
- Overlooking sub-limits: These caps can reduce claim payouts significantly.
- Not checking portability options: If you are not satisfied, you should be able to switch to the best health insurance plan without losing benefits.
- Skipping riders: Riders like critical illness or OPD cover can enhance your base plan meaningfully.
Final Thoughts
Finding the right policy, of course, will depend on assessing your health needs, financial suitability, and what you consider the long-term benefits of that specific policy. Whether you’re taking out a plan for the first time, or switching from your existing one to an option you believe works better for you, you should take the necessary time needed to assess the sum insured, inclusions, exclusions and claim settlement ratio of the plan. Comparing plans online is an excellent way to ensure you buy health insurance that is cost-effective and comprehensive.
At Universal Sompo, we are focused on simplifying health insurance so that it’s reliable, appropriate to your lifestyle, and has your peace of mind at its core. We offer an extensive hospital provider network, showing the robustness of our claim settlement systems, and if you want a specific feature or augmentation (floater), our options are relatively flexible. You can select confidently based on the information we provide.
A good health insurance plan will offer you all the cover you need, with clear terms and conditions for how it applies, and what value-adding benefits apply to it, that may support your wellness. Following these seven tips will help you make an informed decision about the right policy, to protect your health and finances.