What is Top-Up Health Plan
Now, we all know how beneficial health insurance is. One medical emergency can wipe out your savings accounts. Having health insurance ensures that this does not happen. Your insurer is your financial safety net. They put forth either all the money or a part of the money for your treatment. Depending on the insurer you choose, you also get a range of covers.
But what if this is not enough? Suppose you bought insurance years ago. Healthcare costs are continually rising. So you no longer feel secure with your sum assured. But you also do not want to buy a whole new insurance plan. In this case, you can choose top-up health insurance instead!
What are top-up health plans?
A top-up plan gives you additional coverage if your insurance runs out. Suppose you have been hospitalised and your insurance policy covers Rs. 10 lakhs while your top-up cover is Rs. 3 lakhs. If your hospital bill is Rs. 13 lakhs then your insurance and top-up together cover your entire treatment.
Meanwhile, if your hospital and treatment bills exceed Rs. 13 lakhs, you will have to pay the difference out of your own pocket.
Top-up health plans are excellent because they are generally cheaper than buying a whole new plan. This means that the insured does not need to upgrade their current health plan or worry about purchasing a brand new policy. The top-up policy continues to give them the security they need.
Why do top-up plans exist?
The three main reasons why there is a need for top-up health plans:
- Lower Premiums: Insurers typically consider top-up insurance low-risk because of the cut-offs. Therefore, instead of buying a new insurance plan, you can opt for the top-up plan and stay covered.
- Longer Coverage: The main idea behind top-up plans is that your coverage is extended. This means that even if your health insurance policy gets exhausted during your claim process, you will still be covered by your top-up insurance.
- Multiple Insurers: If you are happy with your current health insurance provider but do not like their selection of top-up plans, you can choose a different provider. As long as you exceed the cut-off point, your top-up insurer has to pay. So you always stay covered. This means you can also buy the plan at a cheaper rate.
Before ending this section, we need to explain a key feature of top-up plans: deductibles. We already referred to a cut-off point multiple times in the three primary needs. These cut-offs are also called deductibles. Deductibles basically determine when you can claim your top-up insurance.
E.g. if you have Rs. 5 lakhs sum insured through your top-up health insurance with Rs. 3 lakhs deductible, you can only claim your top-up insurance if your bills exceed Rs. 3 lakhs. Your primary health insurance will need to cover anything less than that.
While we will explore more features and benefits soon, this is a basic understanding of top-up plans. Our experts at Cover 360 know the complete inn and outs of these plans. So they also know which top-up plan is best suited to your needs!