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Health insurance is comprised of different terms, that must be understood by the individual before they buy the plan. Understanding these terms help the individual decide which plan is best for them, and they can buy the same. It also helps ease the claim process.
Today through this article we are discussing one of the terms used in Health insurance which is DEDUCTIBLES! Read below to know about the same.
What Are The Deductibles In Health Insurance In India?
A deductible is an amount that a policyholder has to pay before the insurance company starts paying up. In other words, the insurance company is liable to pay the claim amount only when it exceeds the deductible.
If the deductible of your policy is Rs 30,000 and the claim by the insured is Rs 40,000, then the insurance company is liable to pay only Rs 10,000. However, if the claim amount is less than the deductible, the insurer is not liable to pay any amount.
Here you must note that for high deductible policies, the premium is lower while the low deductible policies charge a higher premium.
Significance Of Deductibles In Health Insurance!
Deductibles prevent people from making trivial claims or going in for unnecessary treatment and hospitalization just because they have insurance cover. Policies with high deductibles mean that you pay a lower premium which is a benefit for you over the years.
You do not file unnecessary claims for small amounts and receive a No Claim bonus. The cumulative bonuses help to increase the coverage amount in the long run.
Well, the flip side of a deductible is your insurance cover is practically useless if your treatment costs do not exceed the minimum specified deductible. So, understand health insurance terms before you opt for cover from an insurer.
What Is Co-Pay Clause In Health Insurance?
A co-pay is a fixed amount that the insured has to pay for a covered medical service and the insurer takes care of the rest of the amount. The co-pay amount depends on the nature of the treatment and medications.
If your policy has a co-pay clause of 10% and your claim is Rs 50,000, then you will have to pay Rs 5,000. The remaining amount will be covered by the insurer.
The purpose of the co-pay clause is to discourage people from making trivial or unnecessary claims and also to reduce the burden on the insurers. If people have MEDICAL INSURANCE, they assume they can undergo treatment at the most expensive hospitals. Co-pay acts as a deterrent.
What To Choose Deductible Or Co-Pay Clause?
Whether one needs to opt for a deductible or co-pay insurance depends largely on several factors - present and past medical condition, lifestyle, pre-existing illness, good physical condition, etc.
It is advisable to examine the health insurance details and understand the health insurance terms before blindly signing up for the policy. This way you avoid unpleasant surprises when you file a claim.
You can contact your insurer or can visit Ashutosh Securities Pvt. Ltd. for any further assistance in mutual fund investment. Keep reading our article and stay updated with the latest news about Health Insurance and Life Insurance!
For any kind of query, you can contact us at Shri Ashutosh Securities Pvt Ltd., we are here to help you in any way possible.
Happy Investing!
(Mutual Fund investments are subject to market risk Illustrations are for example only, there is no guarantee of returns. Past performance is not an indicator/guarantee of future returns).